eBay’s (EBAY) online payments company PayPal will open its payments platform to third party developers.
The new service, called Adaptive Payments Service, consists of a set of APIs that can interact with other programs, explains PCWorld:
In PayPal’s case, the APIs will allow applications that can support transactions such as “chain payments,” where a buyer sends a payment to a primary seller, which then can pass on portions of that money to others with an interest in the transaction.
PayPal says it launched the service to “unleash developer innovation,” but TechCrunch says its a move to compete with Amazon’s Flexible Payment Service. (Not to forget new payment systems like “Pay with Facebook.”)
Both could be true, but more importantly, it’s a way to increase revenue and meet the aggressive $4-$5 billion revenue target eBay set for PayPal to hit in 2011.
In a note to us, JP Morgan analyst Imran Khan says that currently PayPal’s share of total off-eBay ecommerce and online travel is about 4.2%. He believes that at this rate PayPal cannot reach its 2011 target, and must push this market share up to more than 6% to make $4 billion in revenues in 2011.
PayPal did not provide pricing information for Adaptive Payments Service. But it promised to provide more information and preview the API at a limited-seating event on July 23, 2009 in San Jose.
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