Apple, PayPal Talks Over Apple Pay Ended After Deal With Samsung

According to a report from Bank Innovation, Apple and PayPal were in talks to make PayPal the preferred payment process for Apple Pay.

The report notes that those talks ended immediately after PayPal made a deal with Samsung to allow Galaxy S5 users to make payments with the device’s built-in fingerprint scanner. Apple seems to be annoyed with PayPal and even excluded them from the developer documentation of Apple Pay, meaning they did not make the list of acceptable payment platforms that can be used when making transactions with Apple’s new mobile payment system.

Apple and PayPal started talking early on in Apple’s development of Apple Pay, as Apple was setting up partnerships with the card issuing banks and card networks. Since PayPal’s a payments industry leader, it would have been shortsighted for Apple to not reach out to PayPal.

But while these talks were going on, PayPal went ahead and partnered with Samsung on the Galaxy S5 fingerprint scanner, a move that was reportedly forced onto PayPal by eBay CEO John Donahoe. PayPal’s now-former president David Marcus was purportedly categorically against the Samsung deal, knowing that it would jeopardize PayPal’s relationship with Apple. Donahoe won the day, however.

PayPal recently launched an ad campaign that subtly attacks Apple’s security issues with iCloud. The company is suggesting that PayPal is the safer platform for handling and transferring your money.

During its media event a few weeks ago, Apple announced its new mobile payment system called Apple Pay which allows users to use NFC and Touch ID found on the new iPhone 6 and iPhone 6 Plus to make payments.

Apple Pay will be available in the U.S. starting next month as an update to iOS 8. The company will also launch a new Apple Pay API which will allow developers to integrate the new mobile payments system into their own applications.

At launch, Apple claims that their new payment system will work at over 220,000 retails stores within the United States, including Nike, Macy’s, and Walgreens. The company says it is working “very hard” to expand the payments system to other countries.