Fincredible MacroTalk February 2nd: Insights from The Top Digital Payment Platforms
Commentary on digital payments from $PYPL $GPN $V $BAC $AAPL $SQ $PAYO $PINC
Every year, a new digital payment method seems to erupt onto the scene. Since the launch of Paypal in 1998, more than 15 big digital payments platforms have appeared.
Digital payment are replacing traditional methods like cash, checks, wire transfers and even physical credit cards. These new forms of payment allow users to pay for goods and services, send money across borders, and even finance their transactions (Buy Now, Pay Later). In some cases, the volume of the digital transactions exceed the volume of traditional payment methods
In this MacroTalk, we cover recent quotes from earnings calls to get a sense of the current state of digital payments.
All quotes are sourced from Fincredible.
Paypal, The Market Leader
Paypal, the most accepted digital payment platform in North America and Europe, has built an impressive business over the years, and they continue adding new capabilities. Over the past couple of years they’ve introduced tools like savings accounts, buy now pay later, and crypto wallets.
“In the last 2 years, we added 122 million net new active accounts. And despite that spike in new users, our transactions per active account grew to 45 this past year, an 11% increase. And last but not least, we generated $5.4 billion in annual free cash flow.”
Daniel H. Schulman, CEO
Source: PayPal Earnings Presentation
“Venmo had a solid finish to the year and closed out 2021 with more than $0.25 billion of revenue in the fourth quarter, up 80% year-over-year. We are still at the beginning of our monetization journey with Amazon implementing the option to pay with Venmo later this year.”
Daniel H. Schulman, CEO
“We're also very pleased to announce today that we have extended and expanded the scope of our relationship with PayPal, one of the most sophisticated payments companies globally. This multiyear partnership leverages our unparalleled e-commerce technology footprint across cross-border North America, Europe and Asia Pacific, and it will dramatically expand our target addressable markets over its term”
Jeffrey S. Sloan, CEO
“Many current trends in payments, including ADA, RTP, Buy Now, Pay Later, Crypto and wallets are enabling new ways to pay. These represent opportunities for Visa, where we are extraordinarily well positioned to utilize our unique strength and global network to help them grow and scale.”
Alfred Francis Kelly, CEO
“This quarter, we renewed our partnership with PayPay Bank, which enables accounts to PayPay wallet users. PayPay is one of the fastest-growing digital wallets in Japan with 42 million users and the bank already has 4 million Visa debit users.”
Alfred Francis Kelly, CEO
The Digital Payments Competition
While Paypal is still the most accepted digital wallet, new players continue to emerge each year.
Companies like Apple, Payoneer, and Square have created their own digital payment methods or wallets, experiencing tremendous adoption.
“Consumers logged into our digital channels more than 2.7 billion times in the fourth quarter alone. Erica, our digital financial assistant, completed more than 400 million requests from our clients in the year 2021. Half our consumer sales were digital in the fourth quarter. 86% of all the check deposit transactions are now digital. Customer use Zelle to transfer $65 billion in the most recent quarter. The number of Zelle transactions now surpasses the checks written by our consumers.”
Brian Thomas Moynihan, CEO
“I would say that I think Apple Card has a great runway ahead of us. It was rated to the #1 midsized credit carding customer set by J.D. Power and is getting -- has fast become people's main credit card for many, many people. And the growth of Apple Pay has just been stunning. It's been absolutely stunning”
Timothy D. Cook, CEO
“In the third quarter, we launched Cash App Pay in the U.S., a new contactless payment method for online and in-person transactions. With Cash App Pay, individuals can seamlessly pay with their Cash App account at Square Sellers using the QR code or tapping a button on their mobile device to checkout”
Jack Dorsey, CEO
“We acquired a record number of new customers and drove adoption of services like B2B AP/AR, Bank Partnerships, our Commercial Card, Merchant Services, and Working Capital. We also accelerated growth in key regions like Latin America and Eastern Europe and forged new partnerships highlighted by our recently announced relationship with Coupang, a new eCommerce partner in South Korea, and Vimo, a mobile wallet provider in Vietnam, while also executing well on our rollout with eBay,“
Scott Galit, CEO
“Key opportunities include: one, addressing manual disconnected processes with health care purchasing and procurement, which is why we are investing in and scaling our e-invoicing and e-payables with Remitra, our supply chain-focused, SaaS-based digital payments and financial solutions platform.”
Michael J. Alkire, CEO
If you would like to uncover more incredible insights on company earnings calls, use the Fincredible Earnings App. And if you’d like to sync earnings dates to your personal calendar, use the Fincredible Calendar Sync.
Feel free to email us at analyst@fincredible.ai with any comments, inquiries, or whatever you feel like sharing.