Shell is beginning its rollout of the PayPal-enabled Fill Up and Go service across gas stations in Britain, which will allow customers to download the Shell Motorist application and scan a QR code to pay at the pump with their smartphones.

The introduction of the service arrives after months of testing, and suggests that other gas stations will be clamoring to follow in Shell’s footsteps and offer mobile payments to time-strapped consumers. Hundreds of stations across Britain are now equipped to accept PayPal money, a feat which will resonate positively with many mobile enthusiasts.

“The Internet of Things is a very hot trend right now and gas pumps have power to them and are typically already Web-connected,” said Wilson Kerr, ?vice president of business development and sales at Unbound Commerce, Boston. “As such, they are in a well set-up for an app-based payment system and PayPal is certainly a leader that is trusted by consumers.”

Streamlining payment processes
Mobile payments have been catching on with merchants and consumers alike, thanks to their ability to streamline the checkout process, save time and prevent consumers from carrying cash and credit cards on their persons at all times.

“Gas stations and convenient stores are in many ways an ideal environment for mobile payment capabilities,” said Ted Fifelski, president of SimplyTapp, Austin, TX. “Consumers expect a fast, easy experience both at the pump and at the register and NFC terminals with a tap-and-go functionality can provide just that.

“In addition to tap-and-go, technologies like Host Card Emulation, or HCE, offer faster service while allowing in app payments to happen seamlessly, providing a full service all from within the consumer’s vehicle.”

British customers can download Shell’s Motorist app to access the Fill Up and Go service. They must connect their PayPal accounts, set up a PIN code and scan the large QR code visible at each pump to begin the process.

Consumers must then pinpoint how much gas their vehicle will need, and choose the appropriate amount to pay for. The app enables users to select an amount as low as five British pounds and as high as 100 pounds.

Shell’s pumps will begin dispensing fuel after customers have dictated how much they want to spend, and after the QR code has been scanned with a smartphone. The signage around the pumps aims to display directions in an easily readable format, although employees will also need to be kept up-to-speed on the experience in case of confusion.

“A difficulty regarding implementation could be the discovery of the app itself,” Mr. Kerr said. “QR codes are simple and a low-tech way to drive discovery and app downloads, but they do require the consumer to scan and engage.”

After the pump has dispensed the maximum limit for the price set by the customer, it will automatically stop and send a confirmation to the Motorist app, as well as a receipt.

The Shell Motorist app is available to download for Android and iOS devices.

Rise of mobile payments
The role of mobile payments is expected to rise exponentially as more retailers begin accepting methods such as Apple Pay, and consumers drive up adoption rates after initial skepticism fades. The expected rollout of Android Pay later this year will also throw more smartphones owners into mcommerce mix.

Shell’s partnership with PayPal will help place it on many merchants’ radars. Additionally, consumers will receive loyalty points for each of their transactions made via its platform.

This move is likely to ramp up new client sign-ups for PayPal, which recently split from eBay.

Shell would also be well-suited to offer an incentive to customers who have not downloaded the Motorist app, or who are wary of using mobile payments for the first time. The brand could provide a 5 pound credit toward users’ first purchases to drive app downloads and usage of the Fill Up and Go service.

More gas stations are leveraging mobile strategy to continue customer engagement off premises and drive future transactions. Last October, Citgo Petroleum Corporation drove application downloads with its “Win With Citgo” promotion, which offered 108 fans a chance to win significant prizes during the holiday season (see story).

“The real question is in regard to what problem this is solving and how this makes a trip to the gas station more convenient,” Unbound Commerce’s Mr. Kerr said. “Opening an app and validating that you are who you say you are and confirming a PayPal payment linked to that app might be harder and take longer than simply swiping a credit card mag strip.”

Final Take
Alex Samuely is an editorial assistant on Mobile Commerce Daily, New York