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In Germany, you'll soon be able to make contactless payments with your iPhone via PayPal – without using Apple Pay. This is new and has become possible because Apple had to grant access to the NFC chip on its devices. PayPal is taking advantage of this immediately and is bringing its own tap-to-pay feature to the iPhone app. Germany is the first market to roll this out.
Contactless payments with smartphones have long been commonplace, but until now, you've relied on Apple Pay if you use an iPhone. The NFC chip required for these payments was blocked from third-party providers. Now, a new European law is taking effect that requires Apple to open NFC access to other payment services. PayPal is one of the first providers to take advantage of this and launch its own solution – directly via the PayPal app, without the need for Apple Pay or Apple Wallet.
NFC payment via PayPal instead of Apple Pay
With the new feature, you can make contactless payments anywhere Mastercard payments are accepted. The only requirement is that you have the latest version of the PayPal app installed on your iPhone. Once you've done that, you can set PayPal as your default app for contactless payments. This means that when you hold your iPhone to an NFC terminal and double-press the side button, PayPal will open instead of Apple Pay. The payment will then be processed through this app – directly from your linked PayPal account.
Legal background: Opening of NFC access
This is made possible by the EU Digital Markets Act (DMA). This requires large platform operators like Apple to open certain technical interfaces to third-party providers. In this case, this affects the NFC chip in iPhones, which was previously used exclusively by Apple Pay. With the opening, this NFC function is now available to all apps in the European Economic Area. This includes the 27 EU member states as well as Iceland, Liechtenstein, and Norway. Providers like PayPal or banks with their own wallet apps can thus integrate their services directly into iPhones.
Germany is the first market
PayPal has announced that it will initially launch the feature in Germany. The new contactless payment option will be available via the app in the coming weeks. This will make Germany the test market for the new tap-to-pay feature. Other countries in the EEA are expected to follow (via newsroom).
PayPal relies on additional functions
To differentiate itself from Apple Pay, PayPal is focusing on additional offers. Users will have access to cashback promotions within the app—refunds for certain purchases. PayPal also plans to introduce an installment payment feature. Purchases will be able to be split into six, twelve, or 24 monthly installments. This will allow PayPal to specifically target users who want more flexibility when paying.
Competition for Apple Pay
With this move, PayPal is positioning itself as a direct alternative to Apple Pay. This means more choice for iPhone users. The operation is similar to Apple Pay – once set up, everything runs automatically via the selected default app.
PayPal introduces NFC payment on iPhones – first in Germany
PayPal is bringing contactless payments with iPhones to Germany, leveraging a new EU legal framework. The feature runs directly through the PayPal app and works everywhere Mastercard contactless is accepted. You no longer need Apple Pay. PayPal is trying to create additional incentives through cashback offers and scheduled installment payments. For users, this means more flexibility and, for the first time, the ability to freely choose between payment services, even with the iPhone. Germany is leading the way – other countries are likely to follow soon. (Image: PayPal)
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