Paypal diversifies its offering and may look at cryptocurrencies again

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  • Paypal continues to invest strategically to deliver digital payment innovations to merchants and customers alike

  • The company’s growth continues apace as a series of strategic partnerships with customer reward cards, Samsung Pay, Mastercard and Visa extend Paypal’s reach

  • Paypal has recently extended its reach into investments as it looks to extend its financial capabilities and has indicated that it may look at cryptocurrencies again

Paypal the digital payment platform facilitates transfers to the value of 1.6 billion a quarter; as people continue to sign up to their services. 21% of Paypal’s revenue comes from Paypal itself, Venmo and Xoom, so it is still a popular way to send money abroad and make domestic remittance payments to family and friends. The financial powerhouse has the capabilities and partnerships to dominate in the digital payments space, as millennials continue to adopt this payment of choice. Over the last few years, Paypal has made a number of strategic acquisitions, that will drive its service offering forward and set it apart from the competition. Partnerships include the purchase of Brainmo (who also acquired Venmo - the preferred digital wallet for making payments to friends), Swift Financial, Tio Networks and Xoom, the international money transfer company.

In 2017 Paypal expanded links with Visa into Europe, while a strategic link with Samsung Pay added further options to make payments with Paypal. On top of this Paypal has forged a number of partnerships with customer reward cards, which will allow customers to spend their reward points in stores and with merchants that accept Paypal payments. And finally, they announced a partnership with Acorns, an investment management mobile app that invests unused money. They plan to rollout the service to US customers in early 2018 which will enable US Paypal customers to round up their payments, when they complete their purchase, and invest the remaining cents.

Is a move to cryptocurrencies next on the cards?

Under Thiel, the co-founder of Paypal, they forged partnerships with three bitcoin exchanges, Coinbase, BitPay and GoCoin, in a move to facilitate bitcoin payments. However, they ran into difficulties to extend their project further, due to the cryptocurrencies potential to support money laundering and the potentially illicit activities that those payments fund. They eventually abandoned their project. Since Thiel has parted company with Paypal, he has recently invested 20 million into bitcoin and Paypal has since indicated that they may test the water some more, as they seek to expand their service offering.

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