Yahoo to use PayPal for online payments

Yahoo and eBay have announced a new online payment program called the Yahoo PayPal Checkout Program, which will increase PayPal’s profile on the Internet, while at the same time providing Yahoo with a smoother payment system for its services.

Starting April 17, Yahoo Sponsored Search results will feature a blue shopping cart icon linking to merchants that accept PayPal Express Checkout as a method of payment. The program enables a streamlined purchase process for the more than 100 million PayPal customers on the Internet, and helps extends the value of Yahoo’s new search marketing platform (Project Panama).

Yahoo PayPal Checkout Program is being launched with special offers for merchants, such as free PayPal processing until December 31, 2007 and a $100 credit for Yahoo search ads. Once signed up, merchants can expect the PayPal cart icon to appear against their Yahoo listing after ten days:

Here is how it works:

When a user enter a search key to find an item or service to Yahoo Search, the results page may include Yahoo Sponsored Search results matched to the user’s search key. Under the Sponsored Search results, a blue shopping cart icon will appear next to the merchant’s name that has joined the program. By clicking on the ad, users will have direct access to a safe, secure purchasing process that does not require any additional credit card information and can be completed in just a few mouse clicks.

“This is great news for online shoppers and for merchants. Both want the online shopping and buying process to go smoothly and quickly, and connecting Yahoo! Search with PayPal Express accomplishes that,” said Rich Riley, Sr. Vice President, Online Channel & Small Business Services, Yahoo! Inc.

Yahoo is confident that this program will help its sponsored search customers stand out by showing their support for a secure, express service managed by two of the best known online brands.

As part of an agreement entered into one year ago, Yahoo made PayPal the exclusive third-party provider of its online wallet, integrated PayPal with the Yahoo site and began promoting PayPal as Yahoo’s payment solution to Yahoo’s merchants and publishers.

In addition, Yahoo is the exclusive third-party provider of all graphical advertisements throughout the eBay.com site (eBay.com owns PayPal), and provides sponsored search results on eBay.com search results pages.