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McDonald's, PayPal testing mobile payments in Europe

The race to become the de facto leader in mobile payments at your favorite fast food franchise is heating up. According to a new report, McDonald's is currently testing a mobile payments arrangement with PayPal.

Testing is currently underway at 30 McDonald's locations in France, according to Reuters. Although neither company has made any official announcement, the technology is "coming within the next 24 months or so," according to an unnamed McDonald's spokesperson.

McDonald's usage of the PayPal system, which has also been tested at one of the restaurant's locations in Florida in the US, would reportedly allow the restaurant's outlets to accept payments via mobile phone and from your desktop computer. According to the report, the tests in France are currently cordoning off PayPal users in a separate line at the restaurants.

Earlier this year, McDonald's and its UK partner Barclaycard launched an awareness campaign aimed at increasing the use of NFC payment cards at it restaurants. This strategy is likely to be emulated by other retailers worldwide given the relatively slow growth of mobile payments adoption in Western countries when compared to Asia.

Although mobile payments technology seems like a cool bit of science fiction-style convenience, a recent report claimed that only 8 per cent of UK McDonald's customers even knew they had the ability to pay using NFC technology.

PayPal's possible partnership with the world's most famous burger chain is just the latest development in what is shaping up to an epic struggle for mobile payments dominance across the globe. Recently, Starbucks announced a major partnership with Square that will allow for mobile payments at the coffee chain. PayPal also recently rolled out an app enabling mobile payment at four prominent high street retailers.

However, with over 30,000 restaurants worldwide, McDonald's potential deal with the payments company would represent a larger business and cultural footprint for PayPal than perhaps any other mobile payments company in operation.

Nevertheless, PayPal isn't counting on any one retail partner to give it the edge over competing systems. So far, PayPal's other notable retail partners include global brands like Toys "R" Us, Barnes & Noble, Abercrombie & Fitch, Foot Locker, and Office Depot.