Paypal recently announced to open up their payments platform to third-party developers. TechCrunch, that was the first to anounce this news, mentions some examples for possible applications that may arise with the new Paypal API called Adaptive Payments. An interesting example is the “chained payment” which enables a primary receiver to immediately pay out part of the payment to secondary recipients. The website also mentions that with this move Paypal wants to compete with Amazon’s Flexible Payment Service (FPS) that is supposed to provide almost the same functionality.

The interesting question is whether this enables new opportunities for merchants, Payment Service Providers and payment institutions. It would be particularly interesting if this opens new opportunities within the scope of the Payments Service Directive. Since Paypal also has a banking license, it is probably the only bank that offers an API on it’s main payment infrastructure. Of course it only works within Paypal, but imagine the possibilities if the European banks would open up the interfaces towards their (interbank) payment infrastructures. Or is this just what the PSD is meant to enable?

Links related to this article:

Anouncement on TechCrunch: http://www.techcrunch.com/2009/07/06/paypal-looks-to-crush-amazons-fledgling-payment-service-with-a-new-secret-api/

Paypal blog on Adaptive Payments API: https://www.x.com/blog/

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