• 400 days Will The ECB Continue To Hike Rates?
  • 400 days Forbes: Aramco Remains Largest Company In The Middle East
  • 402 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 802 days Could Crypto Overtake Traditional Investment?
  • 806 days Americans Still Quitting Jobs At Record Pace
  • 808 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 811 days Is The Dollar Too Strong?
  • 812 days Big Tech Disappoints Investors on Earnings Calls
  • 813 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 814 days China Is Quietly Trying To Distance Itself From Russia
  • 815 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 819 days Crypto Investors Won Big In 2021
  • 819 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 820 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 822 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 822 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 826 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 826 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 827 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 829 days Are NFTs About To Take Over Gaming?
Could Crypto Overtake Traditional Investment?

Could Crypto Overtake Traditional Investment?

Despite recent volatility, there is…

Another Banner Year for Billionaires

Another Banner Year for Billionaires

Unsurprisingly, last year was very…

  1. Home
  2. News
  3. Breaking News

Barclays And PayPal Join Forces In The Fintech Race

Phone

Amazon, Apple and Alibaba are triple A high-tech threats to banking as we know it, and big banks who now wish they were tech firms--and we may start seeing a lot more counter-threat deal-making in the very near future.

Before big tech becomes big banking, banks are hoping to turn this around, and one of the first potential deals could be a tie-up between British Barclays and PayPal, the digital payments giant.

After all, at stake is a $1.8-trillion global payments industry that accounts for 34 percent of all banking revenues.

On Thursday, Barclays announced a partnership with PayPal that opens the door for the two to explore ways to join forces for a more efficient, high-tech experience for its customers.

According to Reuters, the ultimate goal would be to make it possible for Barclays customers in both the United States and the UK to use their PayPal accounts on Barclays’ online and mobile platforms, and to use Barclays products in PayPal accounts.

Time is of the essence, and banks haven’t been terribly aggressive as they’ve watched giant tech firms make major inroads into the payments industry.  

Even BlackRock co-founder Robert Kapito is worried about tech giants completely disrupting the financial industry, according to Quartz. Ant Financial is controlled by Jack Ma, the founder of e-commerce giant Alibaba, and its Alipay division controls more than half of China’s mobile payments market. That market alone handled $13 trillion in transactions in the first 10 months of 2017. Jack Ma tried to take over MoneyGram, too, but was blocked by the U.S. That won’t stop its aggressive expansion, though.

Banks should also be worried about payment option expansions by Amazon and Apple, enabling easier transactions for purchases.

Amazon’s U.S. patent for its 1-Click technology expires in mid-September—and analysts expect others to jump on this, including Alphabet (NYSE:GOOGL). Amazon’s 1-Click already outdoes online payment systems attached to credit card giants like Visa and Mastercard, which require additional transaction steps.

Related: Is Gold A Commodity Or Currency?

But what really should have Barclays—and friends—spooked is this: Amazon dominates consumerism from shopping to delivery and has a 300-million customer base. Now it’s eyeing payments in a step that would definitively close the loop.  

Amazon is already in talks with major financial institutions, including JP Morgan Chase and Capitol One, to develop an Amazon-branded checking account designed to appeal to younger consumers—in other words, to those consumers who don’t already have a checking account.

“We could imagine Amazon’s banking services growing to more than 70 million U.S. consumer relationships over the next five years or so—the same as Wells Fargo, the third-largest bank in the U.S.,” reports cited analysts from Bain & Company as saying.

And then there’s Apple with its Apple Pay, and Facebook, offering peer-to-peer payments in the U.S. and UK. Even Google is managing its own wallet service. All of these giants plan to increase their presence in the sector, and domination is on the agenda.

By Michael Scott for Safehaven.com

More Top Reads From Safehaven.com:

Back to homepage

Leave a comment

Leave a comment