Vodafone and PayPal have joined forces to allow UK customers to make contactless payments in shops, restaurants and on transport services with their Android smartphones, funded from their PayPal accounts.

From today, customers can link their PayPal account to Vodafone Pay to purchase goods and services simply by tapping their smartphone in more than 400,000 places across the UK that accept contactless payments. Vodafone Pay customers will also be able to use the service to pay to travel across the Transport for London (TfL) network as well as on National Rail services in and around London that accept Contactless and Oyster.

Purchases of up to £30 ($37.3) can be made at any contactless terminal and users wishing to spend more can do so using Vodafone Pay at participating retailers through the use of a PIN. In addition to using their PayPal account, Vodafone customers can now add their Visa and MasterCard bank credit and debit cards to Vodafone Pay so they don’t have to carry plastic cards.

Vodafone Pay can even be used to make a payment when the phone is switched off or out of battery life because the contactless SIM can contact automatically to the contactless terminal to make the transaction.

Vodafone Pay is simple to use with customers needing only to download the Vodafone Wallet app and use a contactless (Near Field Communications or NFC) SIM in their device. If they don’t have a contactless SIM they can get one for free by ordering within the app, online, or at any Vodafone UK store. Customers retain their existing phone number and the contactless service works with more than 100 Android mobile handsets in the UK.

In order to keep track of payments, a notification is sent immediately to the cardholder, confirming that the transaction has been successful, whilst the application has a specific section showing transaction history, with details of the purchase, the place and the date including pending transactions. This information is available within the dedicated section of the app, and PayPal transactions are also logged in the customer’s PayPal account.

Vodafone UK’s head of Consumer Services Kate Wright said: “Our customers told us that being able to use PayPal when making mobile payments was important to them so we’re delighted to now offer this on Vodafone Pay. The service also works with any Visa and MasterCard credit or debit card offering customers greater choice than any other mobile payment service.”

Rob Harper, director of Mobile Commerce, PayPal UK, said: “Money is going digital, and the smartphone is at the centre of this transformation. Mobile payments have long been at the heart of what we do. In fact, this year marks 10 years since we first launched a mobile payment service in the UK. As mobile technology continues to evolve, we will continue to look at new ways to make it easier and faster for our customers to pay.”

Under the agreement with PayPal, anyone who doesn’t have a PayPal account will be able to sign up for one directly from within Vodafone Pay. Vodafone Pay is part of the Vodafone Wallet app, where users can add and keep electronic copies of their store loyalty cards, coupons and vouchers, which can be redeemed at point of sale.

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