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PayPal tries out mobile wallet at Home Depot stores

by Phil Hornshaw

It might not be long before you can head into a store and choose to pay in cash, with a credit card, or using your PayPal account with the help of your iPhone.

That’s according to a new story from Fierce Mobile Content, which confirms that eBay-owned PayPal is trying out a mobile payment service that allows users to pay for goods and services at Home Depot stores either with mobile apps on Apple’s iOS platform or Google’s Android operating system, or with a special PayPal card. The app functionality lets you use your app to access your PayPal account to make your payment, not unlike you might if you were making your purchase online.

There aren’t a lot of details on how the payments work yet, but I wouldn’t be surprised if PayPal was using a system similar to how Starbucks allows users to utilize their mobile apps. The Starbucks app allows users to basically create a Starbucks card on their screens. Starbucks’ loyalty cards can also be loaded with funds at any given time, so when you use the app, it’s the equivalent of having Starbucks’ plastic in your wallet. You can add funds through the app, then just flash it to the barista at the counter, who scans a barcode and debits your account.

PayPal could work the same way, and that actually sounds likely, given that the trial program is also using PayPal cards. In fact, PayPal says it plans to extend the ability to pay for things beyond just mobile devices and the Internet. It’ll also use targeted advertising with users based on their locations around the world.

You can’t just head into a Home Depot and use your PayPal app to pick up new tiles for the bathroom, however. Right now, the trial program only works in five Home Depot stores and is being tested by a small group of PayPal employees, according to the company’s blog on the matter. But PayPal users will likely welcome the functionality, given that there are about 104 million of them in 190 countries, and more than 8 million merchants partnered with the service company.

Allowing payments with mobile apps and cards has worked well for Starbucks, so PayPal would probably be wise to get in on that action, as well.