Need to Know
- The popular fintech plans to introduce high-yield savings accounts, check-cashing services and stock-investing capabilities later this year.
- PayPal’s new features are part of its plans to become a “super app,” which also includes in-person QR code payments and a credit card offered through subsidiary Venmo.
- CEO Dan Schulman, leading the super-app charge, is meeting with major banks and credit card providers to secure partnerships.
- PayPal added 55 million users last year and is currently valued at $300 billion.
After a banner year of growth, PayPal is continuing its push beyond payments.
In an interview with Bloomberg, the company’s CEO, Dan Schulman, continued to outline the company’s plans to become a “super app” — plans Schulman has been discussing externally since at least February — noting that the company plans to launch three new products later this year: high-yield savings accounts, check-cashing services, and stock-investing capabilities.
Schulman first put PayPal’s super app plans into motion three years ago, hoping to satisfy a consumer base who prefer their digital services, from banking to e-comm to mobile wallets, to be consolidated across as few apps as possible.
“There are too many apps on all of our phones — I can’t have an app for my pharmacy, my grocery, for all the different retailers I have,” Schulman said. “I can’t have 40 to 50 different apps on my phone. I can’t remember the passwords, I don’t want to enter in all my info every time. There are really only eight to 10 apps that we use every single day or every single week. Those apps are going to morph into what we call super apps.”
PayPal has already seen success in diversifying its offerings beyond mere payments processing, primarily with its subsidiary Venmo. In January, eligible Venmo customers were able to cash government stimulus checks within that app; in February, the Venmo credit card was made available to all users. And in April, PayPal introduced cryptocurrency buying, selling, and holding capacities to Venmo.
PayPal has also extended its reach into bricks-and-mortar stores, particularly through a partnership with CVS that allows customers to pay for goods in-store through PayPal or Venmo, by scanning a contactless QR code.
The company is in a strong position to act on its super-app goals, after an increase in e-comm, combined with the need for increased flexibility with online payments and digital funds-transfers brought on by COVID-19, led to significant growth for PayPal, which is now valued at $300 billion.
The company added 73 million new active user accounts in 2020, hitting 377 million accounts, and posted two record-breaking quarters. Schulman anticipates PayPal will add another 55 million new users in 2021 but says that more growth is needed before the company’s ambitions beyond payments processing will be sustainable.
“This needs massive scale,” Schulman said. “Half a billion to one billion people, at a minimum. One billion people would be ideal.”