PayPal is now accepting prepaid gift cards

Steven Loeb · November 27, 2013 · Short URL:

Shoppers can use the cards on any website that has PayPal checkout

The holidays are here, and you know what that means: gift cards! Lots and lots of gift cards.

Let's just lay it out on the line here. Gift cards mean only one thing: I either do not know you well enough to know what you actually, or I just don't care. And even better are prepaid cards from Visa, MasterCard or American Express. Because that says: I don't even want, and/or care enough, to find out where you like to shop.

Of course, with that complete lack of effort or originality does come one advantage; you can spend that money anywhere you want. Well, except for most e-commerce sites, which made it a hassle to use them. That is, until now.

PayPal has "discovered a patent-pending and innovative way" for people to use their prepaid gift cards on any site that uses PayPal checkout, it was announced on Tuesday.

Before, even if a customer had a credit or debit card of the same brand, trying to use them on an e-commerce site was a huge hassle, PayPal said.

"Many consumers are forced to call the card issuer or go to a special website to register a billing address before trying to pay with the prepaid gift card." As a result, only 25% of people who tried to use them were successful.

Now, that will no longer be an issue.

"As long as the merchants you are shopping with accept PayPal, you can be assured that you now have extra buying power on top of your existing debit, credit cards or banks," PayPal said.

This is extremely good timing on PayPal’s part. As I said before, you can only imagine how many of these kinds of cards will be given and received this holiday season.

It also gives PayPal a new revenue source, and makes people more likely to use PayPal checkout for their goods. And that could be a huge boon for the company, which saw huge gains in the number of mobile payments on Thanksgiving last year, as did its parent company, eBay.

For eBay, there was a 133% increase in mobile transactions on Thanksgiving compared to 2011. That number was even higher for PayPal, which saw transactions for go up a whopping 173% in the U.S.

With reports that this year will be another record topper, withy Cyber Monday expected to take in a total of $2.27 billion, look for PayPal to cash in nicely.

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