PayPal and Discover team for PayPal payments in retail stores

PayPal has announced that it is expanding its off-line payment capabilities by teaming up with Discover. By teaming with Discover PayPal will be able to get its service into over 7 million merchant locations across the United States. PayPal is also looking forward to the opportunity to expand to millions of international locations in the future.

Starting in 2013, Discover will work with PayPal to enable participating merchant locations to accept PayPal via the merchants PayPal payments via an existing relationship with Discover. What this means is that consumers will be able to use their PayPal account at retail merchant locations just as they do online for online destinations.

Discover says that merchants wanting to accept PayPal won't have to install or upgrade any of their existing point-of-sale hardware or software. Consumers will be alerted that they can use PayPal in the retail locations with signage in the stores. Many people out there use PayPal for shopping online, and receive money via PayPal from auctions and other things.

Being able to walk into a retail store and use their PayPal account, just as they would a normal credit card is a big win for PayPal users. PayPal claims that using your account off-line in a retail store will offer the same speed, simplicity, and security that users enjoy online. I wonder whether buyers and sellers will run into the same issues on physical purchases as online buyers and sellers have with PayPal from time to time. I think many eBay sellers have had PayPal take money from their account based on bogus accusations from buyers. I wonder whether this will be an issue with retail transactions.