VeriFone, PayPal dial up mobile payments deal

From CNET News.com: The mobile payments race took an interesting turn today with an announcement from VeriFone and PayPal.

VeriFone, the business-focused electronic-payments company, unveiled a partnership that brings eBay-owned PayPal's merchant services to VeriFone's PayWare Mobile iPhone application.

PayWare, which is aimed at small businesses, consists of a hardware add-on and complementary iPhone application that turn a mobile handset into a credit card reader. With the new PayPal partnership, PayWare will accommodate PayPal payments as well as traditional credit-card transactions, and PayPal will market PayWare to its user base of business owners and eBay sellers. In addition, PayWare will now be able to handle "bump" transactions between two mobile devices, processed by tapping two compatible phones together.

The "bump" technology may already be familiar to iPhone and Android users. It is licensed from Bump Technologies, which makes an eponymous app that swaps contact information by "bumping" phones. It's already available on PayPal's iPhone app.

The mobile payments space has been an interesting one to watch because start-ups have gained an early advantage, at least in the eyes of the entrepreneur and venture-capital set. Square, a hardware-and-app combo co-founded by Twitter Chairman Jack Dorsey, and Venmo, a more consumer-focused pay-by-text-message start-up, have generated loads of industry buzz.

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