PayPal's recent updates to its software tools for developers provide a clue to its long-term plans for the, the mobile payments tech provider PayPal bought last year.'s software allows a mobile phone's camera to scan card details to initiate a payment. PayPal uses the technology in its PayPal Here mobile card-reading app, and last week PayPal disclosed that it would make the same technology available to developers on Apple's iOS devices.

"The technology will get far more exposure now because it comes as the default in its pairing with PayPal technology in the developer kit," says John Lunn, global director of PayPal's developer network.

Without this tie-in, developers would have to seek out the technology on their own from or a rival, or they would do without.

Because stores the details and preferences of the consumer's payment card in the cloud as an enrolled funding source, a user who scans a card with a app would not have to re-enter payment credentials when spending with other merchants who use the PayPal software development kit, Lunn says.

"We didn't want something that was becoming too complicated to integrate," Lunn says. Early feedback from developers has been positive mainly because PayPal "got it right and asked them what they wanted," he says.

PayPal spent about three months testing the new software tools with developers — a faster pace than is normal for PayPal, Lunn says. "We are rolling things out much quicker than in the past, almost like a startup."

In promoting's technology, PayPal is also demonstrating to developers that new mobile payment systems do not need to rely on Near Field Communication technology. Rival providers such as Google and the wireless carriers' Isis venture are based on NFC, but PayPal supports NFC only as an option for certain Android phones.

PayPal's newest kit focuses first on Apple Inc.'s iOS devices, such as the iPad and iPhone. Though this is not unusual, given the popularity of Apple's devices, it raises the question of whether something deeper is planned, given PayPal's history of forming partnerships with nearby tech companies.

"Their offices are maybe five miles within each other, so it does make you wonder about what they could do together in the future," says Brian Riley, senior research director and analyst with Needham, Mass.-based CEB TowerGroup. Apple is based in Cupertino, Calif., and PayPal is based in nearby San Jose.

Lunn would not speculate about whether the new kits point toward future dealings specifically with Apple, saying that PayPal "always talks to our customers because our mission is to make PayPal [integration] as friendly as we can."

As such, PayPal tries to bring other companies into discussions about future technology through its work with software developers, Lunn says. "If those developers are happy with us, they can maybe sway their company to work with us more in the future," he adds.

PayPal's new software tools fall in line with company president David Marcus' pledge that, in addition to stressing security, PayPal needed to focus on its software becoming more friendly to consumers and developers, says Gil Luria, analyst with Los Angeles-based Wedbush Securities.

PayPal has worked with Apple and Google Inc. in developing mobile wallet software in the past, but the new development tools indicate the company "wants to get even better at that and have tools for mobile wallets that make it easier for the developers to add payments," Luria adds.

Regarding Apple, which has taken a strictly software-based approach to mobile payments with its Passbook app, "it would not be surprising to see PayPal add a Passbook functionality to its mobile pay options, and likewise, Apple would have an option for opening a PayPal account through its Passbook," Luria says.

In announcing the new software tools on the PayPal blog, James Barrese, PayPal's chief technology officer, said because PayPal was undergoing a "massive culture change," it was time to ask software developers "to take another look at the tools we can offer them."

Barrese said PayPal would release new tools for developers throughout 2013 while continuing to support its existing offering. has potential as a tool to enroll consumers in mobile payments, because taking a picture of a card is much more convenient than having to type in the 16-digit card number and other details, says David Kaminsky, analyst for emerging payments with Mercator Advisory Group.

"That said, I don’t see as a viable option for applications that would require repeat usage," Kaminsky says. For now, such potential drawbacks make it hard to envision's technology as an alternative to NFC, Kaminsky says.

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