Redesigned PayPal app wants you to order ahead, skip lines

PayPal has grand plans of replacing your wallet, and it hopes offering more discounts and dining-out payment options will help it do that.

Jeff Loman, a PayPal product manager, looks on as T-We Tea's Keir Lee processes a transaction using PayPal mobile.

(Credit: Donna Tam/CNET)

PayPal wants you to ditch your wallet in favor of its mobile payments app, but it knows it can't compete with your credit cards unless it's got something extra -- like promises of discounts and food.

The company released its redesigned mobile payments app on Thursday, boasting $100 worth of in-store deals, more food spots offering the "order ahead and skip the line" feature, and an experimental function that lets you pay for a restaurant bill without flagging down your server.

PayPal has been in the online payments business for more than a decade, but it finds itself in the middle of a crowded mobile payments space. PayPal, of course, says it doesn't see other companies -- such as Venmo or media darling Square -- as competition. That spot is reserved for credit card companies.

"Consumers have been behaving the same over the last 100 or 150 years," said Jeff Loman, a group product manager for PayPal Mobile. "You're there, you swipe in your card. Payments have never been an issue; you swipe the card and it works. ... Saving that offer, being able to redeem it -- I think that's really how you win or how you get people to use the products. Because they like getting that additional value."

Of course, PayPal is still connected to your credit cards, which are stored in the "wallet" section of the app. But a new BillMeLater feature may change that in the future. The payment option essentially lets independent merchants offer a line of credit to consumers, without having to strike a deal with a major credit card company first.

Loman, who has been with PayPal for about five years, helped launch the app in 2008. He said it's grown significantly since then. The first PayPal app came out when the iPhone did and users could only balance their accounts and send money.

Now you can fully manage your account, see your transaction history, add funds, view deals, and order ahead. The latest version of the app adds more emphasis on features that let you buy things immediately based on location. It removes the initial login screen, opting to ask you to verify when you are looking at sensitive information, like account info, or about to purchase something. The "local" tab is now the "shop" tab. The app lets users look up and redeem deals from merchants and then automatically redeems the deal when an in-store purchase is made.

The app has a new design that has the user check in, order or pay by swiping to the right, which is accompanied by a scrolling scene.

PayPal's big sell is on its order ahead feature. Although it was available before through a partnership with Jamba Juice stores, PayPal has added an integration with Eat24, an order ahead system for food, to expand the number of merchants that offer this service. There's also an experimental feature that lets users pay for a meal at the table without having to wait for a server to bring the check, but it's only available in three restaurants currently, City Winery in New York, 21st Amendment Brewery in San Francisco and Peasona in Melbourne, Australia. To use the feature, servers give users a ticket with a printed code at the start of the meal. After entering the code, diners can order from the app, send feedback, and mark favorite items for their next visit. At the end of the meal, they can pay from the app.

It's a look into the future that PayPal wants to create. The company built a showcase at its headquarters in San Jose, Calif., that highlights similar setups at retail stores and sports stadiums.

PayPal said the response from testing the pay-at-the-table feature has been mainly positive. Letting customers see their bills upfront and pay quickly means less mistakes on orders and a faster turnover of tables. But there is concern from bartenders that it makes it easier for customers to order and then leave without paying, despite having checked in.

Loman said it will take time for merchants to adopt PayPal's new technology, but the company is making partnerships to speed it along.

Adding the Eat24 feature lets PayPal add food merchants quickly, which is key to attracting consumers. PayPal also is integrated with NCR, a company that provides payment kiosks and services at stores at thousands of locations