Paypal launches ‘super app’ with capability to buy cryptocurrencies

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PayPal (NASDAQ:PYPL) on Tuesday completed the long-anticipated launch of its ‘super app’ digital banking product in the US.


The redesigned PayPal (NASDAQ:PYPL) app will now offer a combination of financial tools including direct deposit, a digital wallet, functionality to pay bills and individuals (P2P), shopping/commerce tools, the capability to buy, hold and sell cryptocurrencies, and crowdsourced fundraising.


A high-yield savings account is promised to be added in the coming months, in partnership with Synchrony Bank.


The functionality of direct deposit, means users of the PayPal app could be paid up to two days earlier by their employer or government agencies.


The ability to manage money via a single app is expected to lead to the use of digital wallets doubling to 4.4bn globally by 2025, according to a study by Juniper Research earlier this year.


“We know that about half of customers in the United States don’t even have a savings account, much less one with a very competitive rate,” said PayPal consumer boss Julian King.


“So all in all, we think that by bringing together the full set of solutions on the platform, it’s a really competitive offering for an individual.”


Analysts at broker Wedbush said it was an important milestone in the company’s ongoing monetisation strategy of both sides of its consumer/merchant platforms.


“This will be specifically a critical user engagement tool with the intention of expanding RPUs + user stickiness.


“With nearly half of consumers (48%) citing simplicity as the top reason to use a digital wallet, the new all-in-one app aims to be the primary destination for customers to easily manage their day-to-day financial lives.”


Wedbush said the PayPal Savings launch with Synchrony Bank is expected to offer a high-yield savings account with a 0.40% APY, which is more than six times the national average of 0.06%, despite being lower than some digital banking competitors.


“The company believes that its savings offering will compete based on its combined offerings and will attract users who are switching from a traditional bank or the ~50% of customers in the US that don’t have a savings account. Another initiative on the roadmap is to enter the investment space and support the ability to buy stocks, fractional stocks and ETFs. The app will also later add support for paying with QR codes, like Venmo, and tools for using PayPal to save while in stores.”


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