Paypal buys Fig Card

Quickly following the Visa investment in Square, Paypal announces its purchase of Fig Card.  Fig Card is a low cost, point of sale USB credit card reader that makes it easy for merchants to take credit card purchases using existing equipment.

From the Paypal blog:

“We loved their approach to point-of-sale, particularly because it was driven by the same vision that we have at PayPal – in the future,  transactions can be as smart as a computer and not as dumb as paper. We won’t need our physical wallets. We’ll be able to pay any way we want, from any device, anywhere in the world with both flexibility and privacy.”

A detailed explanation of the Fig Card system from the Fig Card website:

“Fig leverages existing hardware in modern smart phones (namely WiFi functionality) in a non-intuitive way to create a system that checks off a number of boxes towards solving merchant and customer adoption challenges.

  1. No additional hardware is required on the customer device. Customers merely install a free application, setup their payment information (could be a credit card, debit account, phone bill, PayPal account, you name it) and are ready to pay.
  2. Payment information is not directly given to the merchant – no credit card numbers, debit account information, or other potentially sensitive information is given to the merchant. At the same time, Fig can still manage loyalty programs and other identity-based systems for the customer and merchant.
  3. A typical transaction will complete in less than 10 seconds – faster than most credit card transactions and often faster than cash (especially with pesky change!).
  4. The merchant integration consists of extremely cheap off the shelf hardware which would likely be provided free to the merchants, significantly improving adoption rates. Furthermore, for many merchants the business model provides a financial incentive by significantly lowering their effective discount rate for non-cash transactions.
  5. The full featured software application enables many things:
    • Automatic loyalty card management – don’t carry grocery cards, sandwich cards, etc. – the app can just keep track of it all
    • Ordering interfaces – We like to call it “en-route” ordering. The web and the desktop are still great for most things, but taking the gym or lunch examples, a customer might want to place an order or book a class from their mobile phone via a dedicated merchant interface that already has payment information. Fig intends to offer this platform to merchants and independent software vendors at low or no cost.
    • Electronic itemized receipts – while other systems could use email or other external channels to deliver the receipts, Fig can manage them within the application and in real time. This enables a variety of features including social publishing (e.g. Tweet your lunch), detailed budget analysis and optimization (e.g. Mint or Quicken integration) and complex loyalty programs or coupons based on items purchased, time of day, and etc.”

From Gigaom: “The FigCard frames itself as “a new way to use your fancy iPhone to pay for things”– (note – you can also use your fancy Android and select fancy Blackberry). Consumers download the app and use it at participating retail stores. Merchants accept the mobile payments in stores through a $5 USB device that plugs into the cash register or point-of-sale terminal. The cashier never sees the customer’s credit card number.”

From Techcrunch: “This is also as much of a talent acquisition as it is a technology buy. The founders, Max Metral and Hasty Granbery (who will both join the PayPal Mobile team) are both seasoned technology execs. Prior to founding Fig, Metral was co-founder and CTO of Firefly, which was sold to Microsoft. He also went on to architect sign-on system Microsoft Passport. Metral and Granbery met at PeoplePC, which was sold to Earthlink.”

About Daniel Davenport

Daniel is a digital media executive with internet and broadcast experience. Daniel is currently the executive strategy director at THINK Interactive.


  1. Isis: “to avoid falling further behind” | thinkd2c - May 4, 2011

    […] players.  True innovation will probably have to come from more nimble players like Square, Fig Card and Payphone.  These companies can move quickly, form partnerships without legacy relationships […]

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