The rise of PayPal as a major payments player
by JIM MAROUS
No place in financial services is transformation and innovation more apparent than in the world of payments, where the convergence of mobile and new data-driven business models have the potential to completely disrupt both the consumer and merchant experience.
The recently concluded Money2020 illustrated that there is no shortage of payments players vying for attention, but no firm seems to be as aggressive as the new PayPal, which continues to roll out new innovations impacting the payments ecosystem.
While some of the ‘innovation’ at PayPal may not seem new or disruptive (such as the use of QR codes), the ability to quickly build scale by using the existing payments infrastructure may be the key to PayPal’s success. The company hopes to transform its reputation as a means of exchanging cash over the Internet into the default payment system for many everyday transactions.
At stake for PayPal is control of a mobile-payment market that is expected to grow more than three-fold from this year’s $235 billion over the next four years, according to researcher Gartner. PayPal faces a host of competitors, including Google Wallet,Square, Lemon and Stripe (and potentially Amazon and Apple).
Brian Roemmele, researcher and business advisor says of a recent PayPal announcement, “The true innovation that PayPal has achieved is really quite invisible and perhaps even boring to technologists. No iOS devices or android devices deployed at the merchant locations. No new add-ons needed, just the a boring laser bar code scanner that every single major retail store already has.”
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