Online payment company PayPal has announced that its users will be able to shop at selected retail stores using their smartphones.
The UK’s 15 million PayPal customers can use the PayPal inStore app in 230 shops owned by the Aurora Fashion Group, which includes retailers Oasis, Coast and Warehouse, and also in Karen Millen.
PayPal already has a partnership with 400 branches of Pizza Express across the UK, so this is a next step in developing payments on the high street. This method of payment is popular in the US, where PayPal is partnered with 16 retailers.
How does the inStore app work?
Customers can download the app at www.paypal.co.uk/instore. Whilst shopping they enter a Pin number to open the app.
This provides them with a unique barcode and transaction number, which the cashier scans in order to take payment from the customer’s PayPal account. The app works without mobile or Wi-Fi signal, something experts are heralding as a real plus point.
App available on Android and Apple iOS devices
The app is available on Android and Apple devices. It also handles , refunds and discounts. Customers can get refunds for items they’ve bought with PayPal online or in the high street store by logging onto the app instore.
PayPal UK managing director Cameron McLean said: ‘Today marks the start of a quiet revolution in the way we shop on the high street. We’ve created a simple, secure way to use a mobile phone to pay in your favourite stores. The revolution starts today at Oasis, Warehouse, Karen Millen and Coast.
‘The lines between the online world and high street will soon disappear altogether: research we carried out last year amongst major retailers suggested that 2016 will be the year you won’t need a wallet to shop on the British high street. A phone will be enough.’
Protection with the PayPal app
However, the question of consumer protection is a bit of a grey area with the inStore app. The app isn’t included in PayPal’s buyer protection scheme, which the company says only covers online transactions. This could mean you are less protected than you would be when shopping with a debit or credit card directly.
When you pay by credit card, you get extra protection under the chargeback scheme and Section 75 cover under the Consumer Credit Act. Debit cards also fall under the chargeback scheme. There is an ongoing debate over whether PayPal payments falls under either scheme. If you want to guarantee that you’re covered, pay by plastic rather than the PayPal app.