PayPal reaches out to enterprise developers via APIs

PayPal Inc., a provider of online payment services, is providing application programming interfaces (APIs) to let third-party developers and merchants build applications that integrate with the PayPal system, the company announced Monday.

The four APIs use open standards for Web services such as Simple Object Access Protocol (SOAP) and Web Services Description Language (WSDL). With this move, PayPal expects to lure advanced technical developers and enterprise customers to its online payment platform, said Dave McClure, senior manager of the merchant services business unit at the PayPal Developer Network. “The APIs open up PayPal functionality and a more advanced set of services,” he said.

This way, PayPal is looking to expand its user base from its core audience of individuals and small businesses, which make up the bulk of its 45.6 million registered accounts in 38 countries. The total value of transactions handled by PayPal in the first quarter of 2004 was over US$4.3 billion.

The adoption of open standards for Web services is making it easier for third-party developers to take advantage of the APIs from companies such as PayPal, said Jason Bloomberg, a senior analyst with ZapThink LLC. Without open standards, a company would expose an API and would have to provide a toolkit for developers along with it, which makes the process more cumbersome, he said. “Open standards make it more straightforward to take advantage of APIs and opens them up to more people,” Bloomberg said.

The four PayPal APIs are:

— TransactionSearch: for retrieving basic details of a transaction

— GetTransactionDetails: for retrieving all details of a transaction

— Refund Transactions: for reversing a transaction and triggering a refund

— MassPay: for automatically transferring funds to one or many recipients All but MassPay are available now. MassPay is expected to be available next month.

“This is the beginning of our API offerings. This is a family of features we will be enhancing in coming quarters,” said Alan Tien, product manager in the PayPal merchant services business unit. An API that will likely be added before the year is over is one for invoicing functions, Tien said.

As companies expose internal functions through Web services based on open standards, they by definition introduce new security risks, Zapthink’s Bloomberg said. However, PayPal has a good reputation on the security front, and seems to have covered the necessary bases before launching these Web services, Bloomberg said.

The PayPal Web services architecture shares a common API structure with the Web services offerings of eBay, PayPal’s parent company.

Along with its Web services announcement, PayPal is also launching a new information hub for its e-commerce developers called PayPal Developer Central, available via registration at It is part of the PayPal Developer Network, which is at

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