Gravity Payments now allows PayPal card acceptance at about 10,000 merchants in Washington State.

Gravity Payments' clients are mostly small and medium sized businesses in Washington. The company provides credit and debit card processing, electronic check payment, gift card programs and mobile payment technology.

The partnership will aid PayPal's strategy to offer in-store payments—the eBay unit says it will be in 2 million retail locations by the end of 2013.

PayPal's in-store strategy includes a partnership with Discover, a payment acceptance deal with gas station chain Gilbarco Veeder-Root and a number of large retail chains.

The eBay unit also recently offered free processing to merchants to push mobile payment acceptance, and updated its mobile point of sale technology to compete with products such as Square Register. 

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