To begin with, PayPal bump service is conceptually a p2p NFC model, where phones communicate with other phones to initiate a transaction. In advanced economies with good credit card penetration installing NFC infrastructure such as readers/writers at POS will be an added burden, and may never take off. But in emerging economies, such as China and India, NFC has strong potential to be take roots. For example, China Mobile has begun commercial roll out of contactless mobile payments system using RF SIM enabled phones, and China Telecom has promptly followed suit. Any P2P mobile transaction system - be it NFC, RF SIM or PayPal Mobile can lead to creating of new services and products around these platforms. Also customers could find so many new ways to use the p2p NFC, as in the case of MPESA, which was originally invented to deliver micro credits in Kenya, but one customers found innovate ways to use it, turning MPESA into one of most successful mobile payment systems in the world. Some of the services that I could think of where P2P mobile payments will find use are :-
1. Digital Lending. With value (not just money) transfer enabled, services like P2P digital lending can mushroom. For example, music companies can sell songs with DRM allowing certain number of times a song can be rented, and person renting the song can pay the lender directly using p2p NFC. iPad and Kindle have ebooks, and now ebooks can come with limited lending rights. Here again, a simple p2p NFC utility can work.
2. Value Transfer. Promotional coupons provided by advertisers can now be traded amongst peers. Not everyone who receives a $10 coupon has a utility for it, and now one can transfer the coupon to others who have a utility, and get the value in cash through P2P transfer.
3. Payments for Services in Emerging Economies. Vast majority of daily service providers in emerging economies like India can benefit greatly by p2p NFC, Bump and other contact-less payment systems such as RF SIM. Everyone has a mobile phone but not a credit card. As such credit card penetration is almost non existent even with their customers. So customers can pay small businesses such as hair saloons, photocopying service, laundry services, daily door to door vegetable vendors - using P2P mobile money services.
Given that PayPal already has mobile payment services leads me to believe that the new iPhone, Andriod and Blackberry Bump App is one way to promote and increase use of PayPal mobile. The consumers are king. They will find innovative ways to use such a service. I am sure that the PayPal will see this service being used a number of different ways.
