PayPal is continuing its advance through Europe's mobile payments landscape with partner Vodafone, ending any notion the e-commerce payments giant isn't interested in having a presence through Near Field Communication technology at the point of sale.

In launching NFC mobile payments in late June for Vodafone Italia customers using PayPal accounts on Android devices, PayPal marked its second major mobile wallet move since revealing its relationship with Vodafone earlier this year. In April, the company launched PayPal payments within the Vodafone Wallet in Spain.

The collaboration with Vodafone Wallet will ultimately result in millions of PayPal users in Europe being able to make payments on Android smartphones at Visa contactless terminals, said Anuj Nayar, head of global initiatives for PayPal.

The wallet momentum comes at a time when the European economy is spinning from the Brexit vote, moving the U.K. out of the European Union. It's a situation PayPal figures to rise above.

"Brexit will have no immediate impact on the services we provide in the U.K. and the rest of the EU," Nayar said. "PayPal and its employees will continue to serve the U.K. and EU customers after the U.K. has left."

But the current focus is in Italy, with the Vodafone Italia rollout another chapter that "marks the first capability for NFC in-store payments with the PayPal wallet and is a demonstration of our open approach to partnership to deliver consumer choice," Nayar said.

Vodafone Italia also marks the first time consumers in Italy will be able to fund contactless payments at the point of sale through a PayPal account.

Previously, PayPal watched NFC development from the sidelines rather than taking a deep dive with it in various initiatives. In 2011, the company conducted what it was calling a "small test" at the time in Sweden for NFC payments at the point of sale as part of its cloud-based system. 

In that test, Accumulate AB, a Stockholm-based mobile payment app developer, worked on a PayPal in-store application for mobile payments at a sports retailer in Stockholm.

At the same time, PayPal officials said it was inaccurate to label the company as "anti-NFC" and that it found the contactless payment method to be an "interesting technology."

No move PayPal has made to convince its users and merchants that it was interested in advancing its payments technology was stronger than the 2013 acquisition of Braintree Payment Solutions, a mobile pay provider processing $10 billion annually at the time. That acquisition gave PayPal far more flexibility in its mobile payments initiatives. It also fueled the way for a strong person-to-person payment service through Venmo, a company Braintree had acquired in 2012. 

The move to add Braintree to its toolbox also gave PayPal some breathing room for its experiments with physical cards for in-store payments. If the mobile payments initiatives picked up steam sooner, the MasterCard-branded PayPal Prepaid Card and the PayPal MyCash single-use card for topping up PayPal accounts could wait in the wings for future omni-channel opportunities.

PayPal still has retail partners in Home Depot, Foot Locker and others that accept PayPal payments through mobile phone numbers and PINs.

"PayPal believes there’s room for more than one way to pay with mobile phones," Nayar said. "We believe the key is offering choice, flexibility, convenience and security, which PayPal will continue to deliver ourselves and via partners. We’ve strategically chosen to build our products and technologies to be agnostic."

It's a strategy that has served PayPal well and one manifesting itself through the Vodafone deal and other projects since spinning off as a separate company from eBay, said Thad Peterson, senior analyst with Boston-based Aite Group.

"PayPal has clarified its vision to be a global player in the payments ecosystem and to be defined very broadly," Peterson said. "In that position, they are completely open to different ways to apply their functionality."

Mobile wallet development is an area in which PayPal needs to do more work, Peterson said. "If they could find their way into more of the mobile wallets, I think they would be a serious threat to the card networks."

Visa CEO Charlie Scharf has given the impression that Visa is feeling heat from a more aggressive PayPal, saying his company isn't interested in being a partner and, in fact, has to become more aggressive in its approach to compete with PayPal.

PayPal will likely firm up relationships with the major wallet developers as the Braintree platform continues to expand and merchants offer Apple Pay and Android Pay through that platform.

"We are providing merchants with a full platform via Braintree that enables them to put mobile at the center of their value proposition for customers," Nayar said.

"Collaboration is key," he added. "To achieve our vision to deliver more flexibility and choice for consumers and merchants, it will take an entire ecosystem of partners."

Those partners will include financial institutions, technology companies, and payments networks "working together in new ways," Nayar said.

PayPal likes where it is sitting in the payments ecosystem at the moment. Many of its consumers already order ahead and pay a restaurant bill using a barcode or QR code in store with their PayPal app.

In that regard, the company also recognizes some shopping experiences could be improved when the consumer taps and pays with a NFC-enabled device.

It hopes to get to that end by supporting contactless payments through PayPal Here, Paydiant, the PayPal app and partner apps like the Vodafone Wallet.

"PayPal is demonstrating it provides a technology-agnostic platform for merchants and partners to enable consumers to pay any way they want, including bank accounts, credit cards, debit cards, co-branded rewards cards, private label cards and technologies, such as QR codes, Bluetooth and NFC," Nayar said.

And the partnerships are not coming out of nowhere, as PayPal is no stranger to Vodafone. The two companies collaborated nearly a decade ago in developing a service that enabled consumers in Australia to top up their mobile phone accounts through PayPal. 

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