Preparations for the replacement of card signatures with PINs continue in Australia with this new card reader and app from PayPal.
In a few months credit card providers will mandate the replacement of 'swipe and sign' with 'chip and PIN' transactions. PayPal is helping small businesses get ahead of this change by releasing a new version of its PayPal Here app and card reader.
There's nothing new about using a smartphone to accept credit card payments (Tip: Your shop can use a smartphone instead of an EFTPOS terminal), but the early card readers processed the magnetic stripe on the back of the card.
From August 1, chip and PIN will become the primary verification method for locally issued cards, though swipe and sign will still be available if a customer presents a overseas-issued card that does not have a PIN.
So PayPal has announced a new card reader that handles chip and PIN cards and links to the PayPal Here app running on an iPhone or Android phone.
Where the original reader plugged into the headphone port, the new one uses Bluetooth. This arrangement makes sense, as customers expect to make chip and PIN or contactless transactions without letting go of their cards and a plug-in device would have been clumsy and risked broken connectors.
The new reader is expected to go on sale for $139 by the end of June to new and existing PayPal Here users.
PayPal charges 1.95% on credit card payments made using the reader. Higher fees apply for generating an invoice or if the card number is typed into the app.