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BizReport : Mobile Marketing : August 21, 2012

PayPal and McDonald's mobile payments test promises faster fast food

PayPal is vying to be the mobile payments service of choice as more and more consumers start to use their device to make purchases. Their latest deal is with McDonald's.

by Helen Leggatt

paypal_logo-blog-third.jpgThe world's biggest burger restaurant chain is testing mobile payments using PayPal at 30 of its restaurants located in France. This follows demonstrations of PayPal's mobile payment service in Florida earlier this year.

McDonald's customers will be able to place their order via mobile phone, tablet or desktop using a McDonald's mobile app and pay for it using PayPal. Once at the restaurant the customer joins a dedicated meal pick-up line which should help cut down on in-store wait times.

PayPal is up against other services such as Square Inc., a start-up that has recently partnered with Starbucks to provide mobile payments for the coffee shop chain. However, PayPal's deal with McDonald's 30,000 or so locations worldwide would easily trounce Square Inc's deal with U.S. Starbucks outlets.

"McDonald's would certainly be a whale," said Gil Luria, an analyst at Wedbush Securities. "If McDonald's customers can stand in line and order on a mobile app and pay with PayPal, that is a huge extension of PayPal's reach."

Last month, IDC's Consumer Payments survey revealed that over a third of Americans had used their mobile device to make a purchase, up from just 19% the previous year.

Of those that had made a mobile payment, more than half used PayPal Mobile (56%), with Amazon Payments and Apple's iTunes service tied at around 40%.

Tags: food industry, mobile app, mobile marketing, mobile payments, payment solution, retail

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