wordpress blog stats
Connect with us

Hi, what are you looking for?

PayPal scaling investment in crypto-currencies and blockchain, posts net-profit of $1.56 billion

PayPal is scaling its investment in crypto-currency and blockchain products as the future of payments is increasingly moving to the digital realm in the wake of the COVID-19 pandemic. The global payments giant posted a net profit of $1.56 billion for the fourth quarter of the last financial year, up by a whopping 209% year-on-year compared to $507 billion in the same period of the previous year.

The company says that going forward it plans to enhance and grow its product suite, focusing on in-store payments, buy now pay later, digital currencies, bill payment and cross-border commerce over the coming year. “Today, the vast majority of consumers state that post the pandemic they will continue to shop online at their current elevated levels because it is more easier, convenient and saves time. Retailers are rapidly adapting to a new landscape, adjusting their strategy from encouraging consumers to visit their stores to optimising for home delivery. The pandemic has accelerated a digital wave of change across almost every industry by 3-5 years, unleashing a profound and and permanent structural transformation,” said Dan Schulman, president and chief executive officer, PayPal Holdings during an earnings call.

Schulman also said that the company will also be introducing new budget, savings, investment and bill payments tools for its customers and merchants in the current year, in partnership with banks and fintechs.

Digital currencies are the way forward

In October 2020, PayPal began supporting Bitcoin and other crypto-currencies, allowing users to buy, hold, and sell cryptocurrency directly from their PayPal account. Consumers will be able to convert their selected cryptocurrency balance to fiat currency, with certainty of value and no incremental fees, the company said. It added that merchants will have no additional integrations or fees, as all transactions will be settled with fiat currency at their current PayPal rates.

“These initial steps are just the beginning of an extensive roadmap around crypto, blockchain and digital currencies. We are working with regulators and central banks to re-imagine and shape the next generation of the financial system as consumers no longer want to handle cash. We all know the current financial system is antiquated, and we can envision a future where transactions are completed in seconds, not days. A future where transactions should be less expensive to complete and a future that enables all people to be part of the digital economy,” said Schulman.

Advertisement. Scroll to continue reading.

All of PayPal’s customers based in the United States were able to trade crypto-currencies, and now the company plans to expand the offering to international markets in the first half of this year. PayPal will also launch a commercial offering for their global merchants to start accepting crypto-currencies, it said in its investor presentation.

Crypto-currency trading volumes on PayPal exceeded the managements’ expectations during the last few months, said Schulman. “We saw an exceptional response from our crypto launch. We are excited to build upon this early success to allow customers to use their crypto balance as a funding source whenever they shop at our 29 million merchants. We anticipate the roll-out of that capability to begin late this quarter and we hope to launch our first international market in the next several months,

Operational Highlights Q4FY20

PayPal had a very good fourth quarter as both its top-line and bottom-line grew, on the bank of a large inflow of new customers and payments volumes growing by 36% YoY to $277 billion during the quarter. The company added 16 million new accounts in Q4FY20 compared to 15.2 million in Q3FY20 and 9.3 million in Q4FY19, bringing its entire user-base to 377 million as of December 31, 2020. It also added 1.4 million new merchants during the quarter, taking the total to 29 million merchants.

For the full financial year of 2020, PayPal added 72.7 million new accounts, its total payment volume grew by 31% YoY to $936 billion while revenues grew by 22% YoY to $21.5 billion. It plans to add 50 million new accounts this year.

  • Active Accounts: 377 million, up by 24% YoY and 4% QoQ
  • Payment Transactions: 4.4 billion, up by 27% and 10% QoQ
  • Payment transactions per account: 40.9 per account, up by 1% YoY and 2% QoQ
  • Total Payment Volume: $277 billion, up by 36% and 12% QoQ
  • Cross-Border Trade: $46 billion, up by 35% YoY and 15% QoQ

Financial Snapshot Q4FY20

  • Net Revenues: $6.1 billion, up by 23% YoY and 12% QoQ
  • Operating Expenses: $5.15 billion, up by 23% YoY
  • Net Income: $1.56 billion, up by 209% YoY
  • US-based Revenues: $3 billion, up by 18% YoY and 9% QoQ
  • International Revenues: $3 billion, up by 29% YoY and 15% QoQ

Also Read

Download: Earnings Update | Investor Presentation| Earnings Call

Advertisement. Scroll to continue reading.
Written By

Reports on banking, payments, fintech and crypto-curencies. Additional reporting on media regulations, data protection and other areas.

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.



A viewpoint on why the regulation of cryptocurrencies and crypto exchnages under 2019's E-Commerce Rules puts it in a 'grey area'


India's IT Rules mandate a GAC to address user 'grievances' , but is re-instatement of content removed by a platform a power it should...


There is a need for reconceptualizing personal, non-personal data and the concept of privacy itself for regulators to effectively protect data


Existing consumer protection regulations are not sufficient to cover the extent of protection that a crypto-investor would require.


The Delhi High Court should quash the government's order to block Tanul Thakur's website in light of the Shreya Singhal verdict by the Supreme...

You May Also Like


Google has released a Google Travel Trends Report which states that branded budget hotel search queries grew 179% year over year (YOY) in India, in...


135 job openings in over 60 companies are listed at our free Digital and Mobile Job Board: If you’re looking for a job, or...


Rajesh Kumar* doesn’t have many enemies in life. But, Uber, for which he drives a cab everyday, is starting to look like one, he...


By Aroon Deep and Aditya Chunduru You’re reading it here first: Twitter has complied with government requests to censor 52 tweets that mostly criticised...

MediaNama is the premier source of information and analysis on Technology Policy in India. More about MediaNama, and contact information, here.

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ

Subscribe to our daily newsletter
Your email address:*
Please enter all required fields Click to hide
Correct invalid entries Click to hide

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ