PayPal to Offer Mobile Payments by Text Message

Posted on March 27, 2006

USA Today reports that eBay is developing a new service for PayPal called PayPal Mobile. The service will allow people to transfer funds or pay for items using text messages.
When introduced, mobile phone users will be able to send a text message to 729725 (the spelling of PayPal on a numeric handset keypad) with the amount of money the sender wishes to transfer and the recipient's phone number. On the PayPal website, the company uses the example: "Send 5 to 4150001234"

A PayPal computer then calls back the text message sender on the phone and asks the user to enter a secret PIN to confirm the transaction. PayPal immediately notifies the recipient and tells it how to claim the payment online.

The website shows a second option where the customer calls 1-800-4PAYPAL, enters a secret PIN, the amount of the transfer and the phone number where the payment is to be sent.

PayPal has been testing the service with eBay employees and on a handful of customers. It plans to charge no special fees for text payments, but cautions users to check with their mobile phone companies to see if special charges may apply.
USA Today says one feature of the new service, called Text to Buy, allows people to quickly order something they see in a magazine using a cell phone or other mobile device.