Cellcom creating e-wallet to compete with PayPal service

Mobile service provider Cellcom is developing software that would enable its customers to pay for various goods and services over the Internet through their Cellcom account.

The company has been working on the application over the past year as a secret, strategic project with the working name Mobile Payment Project. The final name has not yet been chosen.

Cellcom intends to position its product as direct competition for PayPal, the popular Internet payment system, which according to recent media reports plans to open an office in Israel to pave the way for the company and its service to "make aliyah."

PayPal is perhaps best known as the most popular way of paying for goods ordered through eBay, which itself is busily learning Hebrew in preparation for full-scale immigration to the Jewish state.

The local mobile communications company has an advantage over PayPal in that it already has a captive audience of more than 2 million subscribers, who pay their Cellcom bills by credit card, eliminating the need for a separate account through PayPal or a similar service. Cellcom customers who use prepaid methods to pay for their cell phone use would not be eligible to sign up for the payment system that's in the works.

It can be assumed that Cellcom will allow subscribers to load their payment accounts through their mobile device, perhaps via text message, as well as via the Internet. Where's the profit for Cellcom? In the commission fees it would charge companies signing up for the service, the same as the credit card companies.

Cellcom declined to comment.