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PayPal takes on Square with launch of card readers in the U.S.


PayPal Holdings Inc. plans a challenge to Square Inc. as it launches a physical card reader in the U.S.

The move represents the latest attempt by PayPal PYPL, -0.85% to take a bite of in-store commerce, following its introduction of QR-code payments for its mobile-wallet users last year. With the card reader, called Zettle, the company sees opportunities to create a more unified experience for merchants that already use its services online as well as to establish loyalty tie-ins with the PayPal mobile wallet.

The U.S. launch of PayPal’s card reader comes about three years after PayPal acquired iZettle, a European maker of point-of-sale products, for $2.2 billion. Companies like Square SQ, -0.80% and Shopify Inc. SHOP, -0.20% already offer card readers in addition to online payment capabilities, but PayPal is betting that some of its online customers will want to conduct their in-person and digital sales all with the same provider, especially as physical retail bounces back.

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