PayPal’s buy-it-now and pay-later volumes grow 256%

Creating a payments ecosystem is not easy.

Yes, PayPal noted that it is difficult to advise in the current environment – ​​and yes, macro headwinds are present and impacting results.

But in an effort to integrate payments into a variety of use cases, leverage the platform across borders and payment types, PayPal continues to gain traction, especially in what the CEO Dan Schulman said it’s offering “to have our digital wallets at the center of our consumers’ everyday lives.

To that end, the redesigned PayPal wallet is now installed by over 50% of the company’s base – and digital wallets are linked to a 25% “increase” in transactions compared to other users.

Active accounts rose 9% to 429 million and the number of transactions rose 18% to 5.2 billion, despite a 54% decline in eBay transactions. At the same time, transactions per active account increased by 11% to 47 transactions.

See also: PayPal and Venmo will change instant transfer fees

Additional company filings noted that peer-to-peer (P2P) volume, which includes PayPal, Venmo and Xoom, grew 6% to $89 billion and accounted for 28% of total payments volume.

Cross-border trade remained constant as a percentage of sales, at 14%, similar to the fourth quarter of 2021. Excluding eBay, currency-neutral cross-border trade increased by 4%, on top of the 41% growth seen in 2021.

The growth came even as management said on the quarterly earnings call that, according to the CEO, “an uncertain macroeconomic environment with consequent shifts in consumer behavior…has made visibility more difficult.”

U.S. revenue rose 20% and international revenue fell 5%, while eBay’s international revenue rose 5%, outpacing 47% growth in the first quarter, it said. -he declares. The company added 2.4 million new net active accounts during the quarter. Later in the call, management said that in terms of loyalty, 30% of the customer base drives 80% of the volume.

As for Buy Now, Pay Later (BNPL) details, the company said it saw $3.6 billion in volume in the first quarter, with 18 million customer accounts choosing the financing option since its launch. launch. Additionally, 70% of these users interact with BNPL through the company’s digital wallet.

Related: In bid to raise payout bar, PayPal urges industry to increase permissions

Braintree, he added, saw volumes increase 61% year-over-year, helped by demand for payment processing for customers such as Airbnb.

Venmo’s growth, according to comments on the call, comes on top of 63% growth a year ago. Venmo now has more than 85 million accounts in the United States, the company said, and Venmo is expected to see 50% revenue growth this year.

Additionally, Schulman said that “our integration plans with Amazon are progressing with the second half of the year as the current launch schedule on PayPal and Venmo.”

As noted on the call, as the macroeconomic environment has deteriorated, Russia, Ukraine and China are contributing to heightened global uncertainty and additional inflationary and supply chain pressures, and the management said trying to estimate normalized consumer e-commerce spending as it emerges from the pandemic is “excessively complex.”

As a result, the company lowered its guidance for 2022 and said it would reassess its medium-term outlook. But, as Schulman said on the call, “the age-old headwinds of payments digitization and e-commerce growth are lingering.”

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