PayPal's support of the Pebble smartwatch, an older and less expensive alternative to the Apple Watch and Android Wear watches, signals the acceleration of mobile payments in devices other than smartphones.
PayPal is now available for the Pebble smartwatch, a device that debuted in January 2013 after raising over $10 million in a Kickstarter crowdfunding campaign. The watches have a monochrome screen and today cost $99, making them a more basic but also more affordable alternative to the watches being developed by Apple, Google and Samsung.
Though much attention has been given to higher-end smartwatches with color screens, Bluetooth and/or NFC, Pebble has a strong base of 400,000 users and 18,000 developers.
"No matter which is your favorite smartwatch, we're making it really easy for you to pay at local stores right from your smartwatches," said Joel Yarbrough, Senior Director of Partnerships and Global Solutions for PayPal, in an announcement on PayPal's website.
Pebble also announced it would accept PayPal for sales of its watches. In addition to the original $99 smartwatch, Pebble sells a $199 device called the Pebble Steel, which is made from stainless steel but runs the same apps as the plastic version.
PayPal has been quick to develop apps for other smartwatch platforms, including Android Wear and Samsung Gear. Other companies such as Barclays, Disney and MasterCard have experimented with wearable payments in wristbands and Google Glass. MasterCard also recently added biometrics to the mix in a test with RBC.
In the RBC wristband pilot, heart patterns are used to identify the user, replacing the need to enter a PIN or other identifying information each time the band is used to make a payment.
"Payments and authentication are the two big areas for wearables in financial services," said Jacob Jegher, a senior analyst at Celent. "And those two areas are intertwined."
As wearable computing grows, the opportunity for issuers to adopt the technology will also expand, and issuers should be considering their wearable strategy now, Jegher said.
"There are a slew of Android watches in the market, and the Apple Watch is forthcoming," Jegher said.