I chanced to see a seemingly innocuous news item on PayPal launching a Beta version of its Store Widget-
http://storefront.paypallabs.com/. I am not sure if the Cards and Payments industry is cognizant of the potential implications of the success of this offering!
Ok, how does an online store operate today (I am including the likes of EBay)?
The store has portal hosting the items (goods and services) for sale. Buyers go the store website, use their payment mechanism - cards, PayPal, ACH, etc- and complete the sale. Now, in one stroke, PayPal promises to remove the 'online real estate' requirement!
If you want to sell your stuff, don't have to go to E Bay; just host a blog or an url and peddle your wares!
Why should payment providers and Acquiring banks watch this carefully?
Simple answer: if you and I can host a 'store' without requiring an Acquirer / Host, then why should the Merchants of the world bother to use an Acquirer.
While I see the 'geek's glee' on the launch (see the PayPal blog -http://www.thepaypalblog.com/weblog/2007/12/the-paypal-stor.html), this must make the card payment giants - Visa, MasterCard and American Express - to sit up and take notice.
If it is so easy to accept payments anywhere on the Web, then this can be a huge differentiator for the PayPals and Googles of the world. Moreover, what stops the Mobile Providers from hitching on to the bandwagon -(e.g. use your mobile number and pay me here.....!). Worse
still, what if this is somehow extended to the real world in some form through mobile phones?
Thus far, all such 'revolutions' in the payments world have shown more likeness to Budapest 1956 than Berlin 1989! But then, we are so close to Web 2.0, it may be with you sooner than you think!
P.S: Been watching with great amusement on the Citigroup CEO hunt. The candidates have ranged from the obvious (Gary Crittenden) to the wildest cards - there are notes flying across the Net on Shaukat Aziz (ex-Citibank Executive -PM of Pakistan)! Guess
the bookies should now allow Citi shareholders and employees to place their bets against odds. Gives them a bit of a chance to recover their losses!