Bump, the service that lets people exchange contact information by tapping their iPhones together, has launched a separate iOS app that will do the same thing for payments. Bump Pay lets users enter information for a PayPal account, then transfer up to $1,000 by typing the amount and bumping phones. The app itself is free, and if the PayPal account is linked to a bank account or has money added to it, there's no fee for either sender or receiver. If the sender is using a credit or debit card, it looks like you'll be giving PayPal 2.9 percent of the amount sent plus $0.30 when you receive money.

Bump Pay is meant for quick transfers between friends at restaurants or other situations that would normally be handled with an IOU, but it could theoretically also serve as an easy way to for small business owners to collect payments. Right now, the biggest barriers are the fact that it's limited to iOS and the need for both parties to install an app, a major disadvantage compared with PayPal Here's card reader. The app will also have to build its own user base separate from the main Bump app, competing with the Bump capability in PayPal's own app.

Though Pay might have gotten a boost from being added to Bump, CEO David Lieb told Fast Company that he's trying to avoid adding features that may be killed at a later point. "We decided that when we test these news ideas, we'll test them externally," Lieb said, "So we'll never have a case where we gave it to people, some people didn't really like it while a few people loved it, and then those few people get upset when we decide to not keep supporting it." If Bump Pay is successful, we might see it turn up in a later version of Bump itself.