Better than paper towels is perlite in zip-locks, then put in oven with the pilot light on (or on top of water heater, or other warm - 85-90 degree place). Wet the perlite, then nearly close the zip-lock and pour out all the water leaving only that that clings. Add the seeds, and close. Open every now and then to let in air. Seelings don't rot as easily, are much easier to get out of the bag. I like even better, using petri dishes (plastic ones), but they are not readily available (my University Chem Lab will sell me them) = and they are online too. I use clear duct tape to close these - and they are never 'sealed'. They stack, are easily labeled (but do label both tops and bottoms). I've started thousands of seeds of all kinds - cold stratified, warm stratified, warm moist, with light, no light, and this is the best of all. Perlite, which I really don't like otherwise, works very well with seeds.
Every kind of paper I've used tends to mold, while perlite does not. Paper also will cling to the roots and damage is more likely when trying to separate and plant them. Paper works, but perlite works better.
However, I usually just start my peppers in flats of soiless seed starting mix (high in sphagnum, but not peat). I also put in warm place (nearly 90 degrees) for about three days. Sometimes I alternate with cooler temps (this sometimes seems to speed germination). Then I put the flats on heat mats under lights - (now about 80 degrees). This year my T.S. moruga's came up in about 8 days - about mid-long for all the peppers I started.
