The rumble between those who love the internet and all things digital, versus those who prefer the sound of a cash register and salivate at the smell of a department store is heading in to round two, as Gerry Harvey digs his heels in.

But ignoring online retail for as long as is strategically possible hasn’t just been a pastime of Gerry Harvey and the retailers he has roped in to target the removal of the GST-free threshold on online goods.

Australia’s major banks are doing a splendid job pretending those that shop online are not, and probably never will be, a mainstream target market.

But at least one online payments market could become a missed opportunity for the likes of Westpac, the Commonwealth Bank, National Bank and ANZ.

The market is micropayments and the threat is PayPal, which now has more 3.5 million active Australian customers, and a merchant customer base of 34,000.

Globally its reach extends to 190 markets and it has 90 million active accounts. With scale like that, micropayments suddenly begin to look very attractive.

PayPal is predicting a $36.8 billion online retail market in Australia by 2013, with growth led by micropayments and web-enabled mobile devices.

Read the full article by Charis Palmer here…