PayPal Pushes into In-person Payments with Cashback Rewards, Apple Integration

The PayPal logo is seen at a high-tech park in Beersheba, southern Israel August 28, 2017. (Reuters)
The PayPal logo is seen at a high-tech park in Beersheba, southern Israel August 28, 2017. (Reuters)
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PayPal Pushes into In-person Payments with Cashback Rewards, Apple Integration

The PayPal logo is seen at a high-tech park in Beersheba, southern Israel August 28, 2017. (Reuters)
The PayPal logo is seen at a high-tech park in Beersheba, southern Israel August 28, 2017. (Reuters)

PayPal is expanding into US point-of-sale payments by integrating its debit card with Apple's mobile wallet and offering cashback rewards, as the global online payments giant seeks direct competition with tech companies and banks.

The bid to grab a slice of in-person purchases at stores, cafes and restaurants is part of an ambitious turnaround strategy by new CEO Alex Chriss who joined the company from Intuit last year.

While PayPal has long dominated online payments and peer-to-peer payments via its Venmo app, it has not pushed consumers to use its products in person, Reuters reported.

"E-commerce has obviously been one of the fastest growing areas where people are spending their dollars... but it's not everything," Chriss said. "Now consumers can use PayPal for every purchase, everywhere, every time."

The push into point-of-sales includes 5% cash back for certain products up to $1,000 per month and additional rewards from brands like DoorDash and Sephora.

The value of US debit card payments has jumped in recent years, reaching $4.55 trillion in 2021 up from $2.47 trillion in 2015, according to recent US Federal Reserve data.

Chriss said consumers are becoming increasingly cost-conscious and moving towards debit cards, which allow them to keep within their spending limits.

PayPal will also allow customers to use debit cards with Apple Pay, as users take advantage of mobile wallets and "tap to pay" options.

That makes it among the more competitive debit card cash-back products with only 24% of debit cardholders reporting earning cash-back rewards in 2023, compared with 74% of credit cardholders, a report from purchase rewards firm Valuedynamx showed.

While PayPal has enjoyed a long-held first mover advantage, increasing competition from Apple and Google have taken some share in mobile payments, according to analysts.

As part of the push, the company is making its largest-ever marketing investment to promote using PayPal in person. PayPal declined to disclose amount of that investment, but flagged in its quarterly earnings that marketing and brand campaigns would push up expenses in the second half of the year.

Chriss has called 2024 a "transition year" for PayPal, and has promised to grow revenues beyond transaction-related volume. In January, PayPal launched artificial intelligence-driven products and a one-click checkout feature.

PayPal's stock price is up more than 17% since the beginning of the year, but still trails benchmark S&P 500 index's 22% gain.



Microsoft, Turning 50, Dials up Copilot Actions to Stay in AI Game

The Microsoft logo during the Hanover Fair 2025 (Hannover Messe) in Hanover, Germany, 31 March 2025 (reissued 03 April 2025). (EPA)
The Microsoft logo during the Hanover Fair 2025 (Hannover Messe) in Hanover, Germany, 31 March 2025 (reissued 03 April 2025). (EPA)
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Microsoft, Turning 50, Dials up Copilot Actions to Stay in AI Game

The Microsoft logo during the Hanover Fair 2025 (Hannover Messe) in Hanover, Germany, 31 March 2025 (reissued 03 April 2025). (EPA)
The Microsoft logo during the Hanover Fair 2025 (Hannover Messe) in Hanover, Germany, 31 March 2025 (reissued 03 April 2025). (EPA)

Thousands of people swooned in a dark conference hall that felt more like a rock concert when a Microsoft product manager demonstrated the company's latest feature: how to sum numbers in Excel, with the click of a button.

"It was literally like Mick Jagger walked out," said Yusuf Mehdi, Microsoft's consumer chief marketing officer, who started as an intern.

That was more than 30 years ago. On Friday, the day Microsoft turned 50, the company's leaders and staff gathered at its Redmond headquarters to remember the software maker's glory days while trumpeting what they hope will bring it into the future: more powerful artificial intelligence.

Copilot, Microsoft's AI assistant, is gaining a host of new features to make it more proactive. The version for consumers will start remembering personal facts about them. It will offer birthday reminders or support ahead of a presentation, or consumers can opt out, Mehdi said in an interview.

Copilot likewise will personalize podcasts and shopping recommendations, and it will let consumers task their AI to book events for them, or send a friend a gift while checking in for guidance. "It frees you up," said Mehdi.

Microsoft is hardly first to roll out action-taking or "agentic" software. As with rival systems, the AI will work best on popular sites where Microsoft has done some behind-the-scenes technical work, like with 1-800-Flowers.com and OpenTable, Mehdi said.

Mehdi recalled days when Microsoft was smaller and growing. He said CEO Bill Gates could devour three books' worth of information from one day to the next, at a time when the co-founder still worked on Microsoft software. Mehdi watched Steve Ballmer, Gates' eventual successor, chant "developers, developers, developers!" in a sweat-drenched shirt to rouse a crowd into the ".net" era.

Microsoft went from top of the pack to badly bruised in a high-profile lawsuit that US antitrust enforcers brought against it in 1998. Years later, younger companies and startups, among them Alphabet and ChatGPT creator OpenAI, beat it to the punch on key AI developments.

Satya Nadella, Microsoft's current CEO, is not standing still. The leader who turned Microsoft into the No. 2 cloud powerhouse challenged his executives at an internal summit this week, recalled Mehdi: "How do we rethink the way that we build the software?"

Microsoft is iterating on its chatbot technology in a crowded field that includes Elon Musk's xAI and Anthropic. It has added Copilot to its heavily used productivity suites for business while giving consumers a distinctive version.

"It's warm; it has that personality," said Mehdi. Some users have taken to this, while others find it asks too many questions, he said.

"When we get to now be more personalized, we can start to get smarter," Mehdi said. "We're part way through that journey."