SK C&C, PayPal team up

By Kim Yoo-chul

SK C&C, a system integrator affiliated with SK Group, has teamed up with the world’s largest online payment company PayPal to let home improvement shoppers pay with their PayPal accounts.

The strategic alliance comes as the Korean system integration (SI) solution providers tried to set up a transaction system specific for smartphones and tablets.

Under the alliance, the two are supposed to develop and sell mobile wallet applications including PayPal’s transaction technologies to more registered outlets in North America.

Also, consumers can pay by using their PayPal accounts with just clicking on the downloaded mobile wallet application icon on smartphones, offline, SK C&C said in a statement, Sunday.

SK spokesman Kim Young-dae said that mobile wallet technologies developed by the firm will additionally work with PayPal to bring large merchants and their services including mobile closed-loop cards, offers and loyalty programs into the PayPal’s mobile app.

The Bundang, Gyeonggi Province-based company is expanding its mobile payments after signing similar partnership agreements with Google and Dunkin Donuts over the past few months.

Over 1 billion people are projected to use mobile payments with almost $1 trillion in transaction value by 2016, according to a market research firm IE Market Research.

SK C&C is already teaming up with Vodafone for the joint mobile-commerce business.

The service with Vodafone is planning to introduce applications that offer discount coupons and pre-paid cards, is set to start from the first quarter of next year in Germany and Spain before reaching other countries in Europe.

Despite the business expansion, local markets are still in doubt whether the mobile wallet business will help SK C&C in terms of profit.

``We believe the mobile wallet business with Google over the last two years failed to yield any visible returns. Just getting commission through issuances won’t make any big difference. Many pending issues such as power play between card-issuance firms and banks and security should be solved before the market growth. But that will be a time-consuming process which we believe needs at least four years,’’ said Cheon Yong-ki, an analyst at Hyundai Securities.

Citing those concerns, the local brokerage lowered its target price on SK C&C to 123,000 won from previous 140,000 won.