Why Did PayPal Buy Fig Card? Find Out

The word is that once upon a time, eBays PayPal tried to buy Jack Dorseys Square. Knowing Dorseys ambition, it was obvious that wasnt going to work out. What was clear though PayPal knew that it had to get a piece of the non-webtransactionbusiness and jump on the big people-to-people economy trend that is starting to gain traction.

Today, the company announced its buying small Boston-based mobile-payment startup Fig Card, whose founders Max Metral and Hasty Granbery will go to work for eBays Paypal division.

The FigCard frames itself as a new way to use your fancy iPhone to pay for things (note you can also use your fancy Android and select fancy Blackberry).Consumers download the app and use it at participating retail stores. Merchants accept the mobile payments in stores through a $5 USB device that plugs into the cash register or point-of-sale terminal. The cashier never sees the customers credit card number.

The acquisition fits into Paypals strategy to acquire existing technology and talent to help build its mobile and platform businesses. In a blog post announcing the deal, Peter Chu, PayPals senior director of mobile, local and new ventures said Fig Card fit Paypals vision of a future that not separates payment from the PC.

We loved their approach to point-of-sale, particularly because it was driven by the same vision that we have at PayPal in the future, transactions can be as smart as a computer and not as dumb as paper. We wont need our physical wallets. Well be able to pay any way we want, from any device, anywhere in the world with both flexibility and privacy.

Keith Rabois, who runs Square and was a key executive during the pre-eBay days at PayPalrecently told ushis company was going after 26 million folks who are not merchants in a classic sense. I guess, so does PayPal.

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