eBay's PayPal is talks with Google to add the payment serrvice to Android phones.

Even if Android run phones users can use eBay's Pay Pal payment service to pay for app purchases, it has been reported that the payment service is in talks with Google to make it more integrated with the platform. A report out last week suggests that if the ongoing negotiations go as planned, Pay Pal should be available to Google's Android phones owners by year's end. Android apps purchases currently are made using a credit card or Google's own competitor to PayPal, Google Checkout. PayPal for mobile would work in a more integrated fashion on Android run phones similar to how the iTunes Store works on Apple's iOS devices.
Google's chief competition in smartphones, Apple, uses iTunes to handle payments for app purchases on its iPhone, iPod Touch, and iPad.
To broaden its sphere into the world of mobile payments, PayPal already introduced a new service for apps developers called Guest Payments in June that will let them accept credit card payments using PayPal without requiring buyers to have a PayPal account. With the service, Software developers offer credit card payments for applications, with PayPal electronically transferring the funds between buyer and seller.

For more, see CNET.com

Square is a free alternative to accept credit card payments through smartphones.

For business people who lack the resources to use a traditional credit card processing service to accept credit card payments, or people who conduct most of their business on the go, there is now an option to take credit card payments if they own a smart phone.A startup called Square.com launched this past December, has devised a mobile payment system that works through a smartphone. Vendors can sign-up at SquareUp.com and receive for free a small credit-card reader that is to be inserted into the audio jack of the phone. When customers make a purchase, they swipe their credit cards into the reader which would authenticate the card through the phone and let the customers sign their names on the screen to complete the transaction.

Available at first for iPhone and other Apple mobile devices, the system is now available for Android based phones.

According to appscout.com, Square charges a flat fee of 2.75% plus 15 cents for every swipe, and 3.5% plus 15 cents for any charge where a card is not present but the number is keyed in.

For more, see appscout.com