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New PayPal Digital Wallet Lets You Choose How to Pay

Digital payments are hitting in a big way at SXSW Interactive. Today, in an exclusive talk for conference attendees, PayPal VP for global product and experience Sam Shrauger took the wraps off a brand new digital wallet. Earlier this week, a blog post on the company website promised that Shrauger would demonstrate the new payment experience at his talk, "Why a Mobile Wallet Isn't Going to Be Enough." We just saw how it works, and it's impressive indeed. Touted as a "smart wallet" that lives in the cloud, the service lets you move your money exactly the way you want it to. 

Firing shots at both Google Wallet and ISIS mobile payments, Shrauger says it's a departure from the concept of a mobile wallet — or simply transferring your physical wallet to your smartphone or tablet — which doesn't solve any of our current virtual payment problems. PayPal's service is a real digital wallet. How does it work?

The UI of the digital wallet looks almost like an online bank account, which holds balances connected to debit and credit cards as well as loyalty cards. Check out our screenshots in our gallery below to see how it looks like. One feature the digital wallet vaunts is a grace period. You get the ability to make a purchase now — whether in-store or online — then decide afterward how you'd like to pay for it, up to seven days later. You can even change the way you want to pay within that period.

Got some unused loyalty cards lying around? PayPal will also let you combine different payment methods — like using reward points and frequent flyer miles as currency, or setting up installments. Other handy functions include digital receipts and the ability to configure a set of "Spending Rules" — settings that automatically choose your method of payment depending on what you're buying (e.g., you can use one type of payment for purchasing a vacation, and another payment method for appliances).

PayPal's new digital wallet features are slated to go live in May.