IDG News Service — PayPal will open an applications store this year where developers can offer their wares, the latest step in the company's multi-pronged strategy to deepen its relationship with external programmers.

Developers have a big opportunity to offer applications for merchants and consumers that PayPal doesn't have the interest or resources to build itself, a PayPal official said Tuesday.

"It could be an invoicing application for a merchant or a 'daily deals' application for consumers," said Osama Bedier, vice president of PayPal's Platform Business Unit and Emerging Technologies.

Last year, eBay (EBAY) did a similar thing, turning its Selling Manager suite of merchant tools into an open repository and storefront for externally developed applications.

The app store plans are the latest step in PayPal's aggressive strategy to lure external developers after the company opened its payments platform late last year.

"We have a huge emphasis on interacting with developers. They're our customers, along with consumers and merchants," Bedier said during an interview at an outside café in Miami Beach's Lincoln Road promenade.

He was in town to address a crowd of developers at the Future of Web Apps (FOWA) conference at the nearby Colony Theater. PayPal will have a presence at more than 110 developer events this year, he said.

"We want to help these guys become successful. It's not just a matter of 'here are our tools, go use them.' We have to be where they are and be active in the developer community," he said.

"I want developers to think of PayPal first whenever they hear the word 'payments' and I want to know what it will take to get there. We're willing to do it. We're willing to innovate and experiment on their behalf and hear their feedback," he said.

For years, PayPal was content to have developers link its payment system with external Web sites for checkout functionality. It no longer considers that good enough.

For starters, PayPal wants to expand beyond conventional online commerce. At his FOWA talk later in the day, Bedier said e-commerce transactions make up only about 4 percent of U.S. retail spending.

With smartphones, PayPal sees a future in which its system can be used to pay at the grocery store, the cleaners, the gas station, and for things like rent and parking meters, he said.

"This is why this opportunity is so gigantic," he said during his talk. "There's a lot of opportunity in breaking out of the shell of e-commerce."

PayPal is doing a limited beta test of its Mobile Payments library, which is designed to let developers add payment functionality to iPhone applications. The library will later be extended to other smartphone platforms.

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