Integrated payments are transactions conducted inside an app or website rather than in a brick-and-mortar store. The transactions happen directly between two accounts online without having to use physical cash, bank cards or other payment methods. Integrated payments are capable of being integrated both with the web and with mobile apps that have Internet access. Over 80% of new mobile apps are downloaded onto smartphones.

The history of integrated payment systems

Integrated payments have their roots in online banking, with the first attempts to move beyond the borders of the world’s computer screens made back in 2000. The PayPal service was launched for transferring money between users’ own bank accounts without any intermediary financial institutions coming into play.

The first attempts to combine online payments with mobile apps were made in Japan in 2003, when the i-mode service became available (the application was developed by NTT DoCoMo). The system used SMS messages to send text messages containing payment details between phones. It seems that this service is still working successfully 11 years later!

The next milestone was reached in 2007, when the first smartphones with Android and iOS operating systems were released. The two technologies together generated a huge demand for mobile Internet services and apps. At this point integrated payment systems gained popularity: they were easy to use and saved customers time (the way it functioned was conceptually simple). The number of mobile payment users grew steadily over the next four years. In 2010 the joint venture PayPal-Ogone was formed (the companies were interested in developing an alternative to i-mode for paying for online services).

It is worth noting that it took another year and a half before eBay sold the company, transferring integrated payment systems into mainstream use. The PayPal mobile application for shopping or making payments was launched in 2011. A year later, the number of apps that could be used to pay for goods and services exceeded 10 million, with PayPal being one of them.

The main advantages of using integrated payment systems

Integrated payment systems have huge advantages over traditional online banking. They are accessible from anywhere, are easy to use and have many useful features.

The advantages of PayPal are obvious: it is an already tried-and-tested service that has been working successfully for over 10 years. A big advantage of using this payment system is that you can send money or pay for goods without disclosing your personal bank details online. Both the sender and the recipient of money are marked by numbers. The only thing that has to be remembered is your numbers and PIN code (the system creates a virtual credit card number to carry out transactions).

The service’s interface allows you to pay for web services simply by entering the email address – no need to provide any additional banking details. Another advantage – PayPal is also available offline. You can pay for goods in shops by simply showing the QR code containing your virtual credit card number to a cashier.

A lot of mobile apps also use this service: all you need to do is connect your PayPal account with such apps and you can make payments using them (the stores or companies don’t have to pay credit card fees and you don’t need to use your mobile balance).

Simple and accessible system: all you need is a smartphone with an Internet connection and a free PayPal account. When buying goods, scanning the QR code with an app can be just as easy as entering the email address you used when creating your PayPal profile. Integrated payment systems are simply the most convenient way to pay for online services and purchases of goods and commodities.

Money transfers: another advantage of integrated payment systems is that they allow you to transfer money between your account and a bank card (wherever you happen to be and without using a computer). The sum can also be paid for by SMS messages sent from your phone.