Updated from Feb. 29 to include a Piper Jaffray survey.

PayPal (PYPL) may have decades of experience in digital payments, but as the company looks to strengthen its in-store solution, it's not so clear whether it can succeed against the likes of Apple (AAPL) Pay and Alphabet/Google's (GOOGL) Android Pay.

For years now, PayPal has had a mobile wallet that can be used in physical stores, but that has only made up a fraction of the company's business, which focuses more on e-commerce transactions that can be made on all devices. PayPal doesn't break out how much of its transactions occur in-store versus in-app or online.

But now that the in-store mobile wallet is gaining attention as Apple, Google, Samsung, and others try to win over the space, PayPal is putting more weight behind its own in-store mobile wallet.

"In-store has always been something that we've thought about," said Bill Ready, SVP, Global Head of Product & Engineering at PayPal. "We're very focused on helping consumers and merchants connect in all the ways they might connect with each other whether it's online, in-app, or in-store."

The issue is that it seems PayPal has a long way to go to beat some of the other in-store mobile wallets. According to a new survey from Piper Jaffray, 67% of merchants who asked their point-of-sale technology providers for information on implementing mobile payments asked specifically about Apple Pay, 18% asked about Android Pay, 8% asked about PayPal, and 7% asked about Samsung Pay.

"We believe it is telling that PayPal, who has been the leader in digital payments, so significantly under-indexed Apple Pay and Android Pay," Piper Jaffray analyst Gene Munster wrote in a note on Wednesday.

Certain announcements PayPal made at Mobile World Congress suggest that PayPal is ready to ramp up its in-store efforts to win over more merchants and consumers.

PayPal announced that it had partnered with Vodafone and America Movil subsidiaries Telcel and Claro in Latin America. These partnerships mean that in Europe, Mexico, and Brazil, phones will have a PayPal-powered mobile wallet already installed in them.

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The partnerships are a big deal, since one of PayPal's main challenges going up against Apple and Google is that it doesn't own any devices or operating systems.

"Apple has this natural customer base just from all of the users of products that support Apple Pay," said Andrew Chanin, CEO of PureFunds, which has an ETF for mobile payments, where PayPal is the second largest holding. "Because they have the hardware that's being used, whether it's the watch or phones, they have the potential to be a hindrance to PayPal's growth."

While PayPal may not own the devices, it does already have a large base of 179 million active users who trust its brand for digital payments. That's where it has an advantage compared to Apple and Google, both of whom still need to create that level of trust when it comes to payments.

Plus the fact that PayPal is not connected to any device makes it agnostic in a way that could make it easier to grow.

"They bring some size with them while still being more or less neutral, in the sense that they're not tied to a platform or card system, which from a retailer standpoint is helpful because it balances out accessibility," said Greg Portell, a partner in A.T. Kearney's Consumer Products & Retail and Media Practices.

PayPal also announced at Mobile World Congress that it would be adding near-field communication technology (NFC) to its own app in the U.S. and Australia. That's the technology that powers Apple Pay and Android Pay and lets you tap your phone to pay.

The fact that PayPal is rolling out different solutions in different countries sheds light on PayPal's strategy.

"Things that may make sense in Australia or Europe may not make sense in the U.S. or Latin America, so PayPal has a series of products and projects that are attempting to figure out the right type of solutions for each geography," said Wedbush analyst Gil Luria.

While it's still early days for in-store mobile payments, these kinds of experiments from PayPal stand to pay off down the line.

"The market for payments in-store is ten times the market for online," Luria said, adding that within five to ten years he thinks everyone will be using a mobile wallet. "Even if PayPal gets a very small piece of that pie it'll be very meaningful to their growth."

And it's always important to remember that in-store mobile payments are just one of PayPal's many businesses keeping it afloat.

"In-store would be important but a part of mobile, not the only driver of mobile," PayPal's Ready said. "We have looked at a progression of e-commerce that has really been about going online to mobile to in-app and now in-store."

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