FinTech: PayPal Plans To Transform Into A Financial Super App
The payments titan will offer stock trading and savings accounts.
Paypal (NASDAQ: PYPL) will expand into new lines of business in financial services, CEO Dan Schulman said at the company’s Investor Day. The fintech giant, known the world over for its ubiquitous check out button, now has ambitions to scale up and become a financial super app. The grand plan includes offering new services such as stock trading, high-yield savings accounts, bill-payment capabilities, and check-cashing. (Bloomberg Quint)
PayPal had a record year in 2020
During 2020, PayPal added 72.7 million users and active accounts numbered 377 million by the end of the fourth quarter.
For the year it processed a record $936 billion in payments, up 31% over 2019, its strongest ever annual performance.
It reported net revenues of $21.45 billion, up 22% year-on-year. Earning per share jumped 71% to $3.54.
“PayPal delivered a record performance in 2020 as businesses of all sizes have digitized in the wake of the pandemic,” said Schulman. “In this historic year, we released more products than ever before and have dramatically scaled our acceptance worldwide.”
A “digital-first world is no longer our future. It’s our current reality and it will forever change the way we interact across almost all elements of our lives.”
No surprises then that PayPal has set its sights on becoming a financial supermarket.
It plans to split its digital wallet into three separate tabs representing financial services, payments, and shopping respectively.
Crypto proved its point at PayPal
The company is encouraged by the massive response to its decision in October 2020 to introduce crypto transactions on its platform.
PayPal customers can now buy, sell, and hold bitcoin and other cryptocurrencies using the company’s online wallets.
The popularity of the facility can be gauged from the fact that crypto-assets trading volume on PayPal hit $242 million this January 11 after previously breaking records.
The company drew an important insight from its crypto experience. It found that half of all customers who used the crypto feature started logging into the app every day. Clearly, these customers are now using the app for more than just payment at checkout.
“This is precisely the type of engagement that we want to see as we add these additional financial services,” Chief Financial Officer John Rainey said.
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