PayPal this week announced an expanded relationship with American Express that will allow cardholders to use their Membership Rewards points when shopping from PayPal merchants, as well as more integrated experience within both PayPal and the Amex apps, among other things.
The deal is similar to those PayPal earlier struck with Visa and MasterCard., and follows a series of partnerships it has made across the industry, including others with Apple, Google, Samsung, and, most recently, Walmart, designed to increase its PayPal’s visibility and adoption.
In addition to using points for purchases at PayPal’s millions of online merchants, the new partnership will also allow Amex mobile app users to send money through PayPal or Venmo directly in the app. And they’ll be able to add their American Express cards to their PayPal wallet directly from the app, too.
On PayPal’s side, users will be able to pay their Amex bill with their PayPal or Venmo balance using the PayPal Instant Transfer feature, and it will more clearly identify users’ specific American Express cards in the PayPal wallet using card-specific branding.
These agreements have represented something of a change of course for PayPal over the past couple of years. Before, the company had been pursuing its own brick-and-mortar strategy to see its payment mechanism integrated at point-of-sale. But those ambitions have died down, and now PayPal is focused on expanding its relationships other payment providers, like Apple Pay or major credit cards, turning former rivals into partners.
“This partnership is the product of our companies’ strong commitment to create innovative payment experiences that utilize both organizations’ core assets, including the ability for customers to pay with American Express Membership Rewards points and the integration of peer-to-peer payments into the Amex app,” said Dan Schulman, President and CEO, PayPal, in a statement about the Amex agreement. “Our new partnership expands PayPal’s ubiquity, and enables us to offer consumers and merchants new and innovative product experiences,” he added.
PayPal says it will also integrate into the American Express Token Service, and continue its global card acceptance relationship, as part of this deal. The two companies will work together to implement the new features over the course of 2019.
These expanded agreements with stakeholders in the payments industry may be working.
The company also reported earnings this week, noting the addition of 9.1 million accounts during the quarter and a 25 percent increase in total payment volume. Payment volume in Venmo was also up 78% in Q3. PayPal’s total revenue grew 14% in the quarter to $3.68 billion, while earnings were up 26 percent.
Source: TechCrunch
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