PayPal President David Marcus, eBay CEO John Donahoe (PayPal is an eBay brand), and SoftBank CEO Masayoshi Son announced “PayPal Here” in Tokyo today, a payment solution for smartphones.
This is huge news for PayPal’s Japan unit, which has been operating in this country for years but hasn’t achieved the success it has seen in other countries so far (see Asiajin editor Akky Akimoto’s comment on Quora from last year for reasons why).
The plan is to establish a joint venture company, “PayPal Japan”, and introduce the “PayPal Here” service in the Japanese market (following the US, Canada, Hong Kong and Australia – visit TechCrunch for more information).
Each partner will hold a 50% stake in the new company and commits to invest 1 billion yen (US$12.5 million).
The joint venture will bring together the strengths of both companies – PayPal’s global online and mobile payment solutions with 110 million active accounts in 190 markets and 25 currencies, along with the SOFTBANK Group’s local market knowledge, 29 million mobile subscribers*2 and vast distribution network including thousands of retail outlets and sales staff across Japan. By bringing together these global and local assets, the joint venture will provide the premier digital wallet for online, mobile and offline transactions to connect millions of Japanese consumers and merchants and expand the use of digital payment solutions, such as PayPal Here, in the Japanese market. (…)
PayPal and SOFTBANK expect PayPal Here to revolutionize the Japanese retail commerce market worth JPY134 trillion (USD1.7 trillion) in 2011and support the growth of 4.7 million small businesses, which account for 99% of all businesses and 70% of all employment in Japan.
What’s interesting is that the new partners aren’t losing time: the iPhone app for merchants and “PayPal Here” card reader are already available today at several “select” stores in Japan before SoftBank plans to roll out the reader “in the next several weeks” in their stores all over Japan.
The reader costs 1,200 yen, while each transaction will be taxed with 5% (there will be no fixed fees).