PayPal Inc., pushing ahead with its drive to become the payment option of choice at the point of sale, has entered an agreement with hardware maker NCR Corp.

PayPal, a unit of San Jose, Calif.-based eBay Inc., announced Jan. 15 that NCR will include PayPal as a payment option in its web-based NCR Mobile Pay application, which is used at restaurants and other retailers that have NCR Aloha point-of-sale terminals.

In addition, the companies will continue to work to incorporate PayPal as an option in NCR's mobile application for payments at convenience stores and gas stations, Don Kingsborough, PayPal's vice president of retail sales, says in the PayPal blog.

To expand its payment options into new retail categories, PayPal has to form "strong relationships with leaders in those categories" and the agreement with NCR provides "a strong footprint" for PayPal, Kingsborough says.

PayPal will upgrade its own mobile pay application to allow users to locate, order ahead and "check-in" at participating NCR Mobile Pay merchants, Kingsborough adds.

The NCR Mobile Pay application operates at more than 60,000 restaurant sites, Duluth, Ga.-based NCR stated in a press release.

Once a waiter has visited the table, a diner can use his smartphone to input a unique code into a specific Web browser that allows NCR Mobile Pay to collect the check detail of all ordered menu items, NCR says.

With its connection to an Aloha POS terminal, the mobile pay app allows restaurant patrons to initiate payment from the mobile phone. In addition, diners can alert their servers through the app, order another menu item, select and store their favorite items for future reference, and provide feedback about the service at the restaurant.

In the future, the companies plan to also include NCR's loyalty and offer management system with the PayPal digital wallet, NCR says. Such an arrangement would allow consumers to "check in" as they start shopping, enabling them to develop shopping lists and redeem digital coupons or special offers when they pay.

While it may not send shock waves through the industry in the manner as PayPal's deal last year with Discover Financial Services, the new relationship with NCR brings PayPal another major dose of exposure.

The agreement illustrates that PayPal continues to be aggressive in its attempt to be at the forefront of mobile payments, says Brian Riley, senior research director and analyst with Needham, Mass.-based CEB TowerGroup.

"PayPal wants to be all things to all people, except a bank, because they don't want to be regulated" like a bank, Riley says.

PayPal's agreement last year with Discover to route PayPal payments over Discover's network starting in the spring of 2013 was a significant agreement for the online payments provider, Riley says. "But the linkage with NCR now shows how far PayPal is willing to go in this process," he adds.

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