PayPal expanded partnership with American Express
On October 18, PayPal (PYPL) announced an expansion of its existing partnership agreement with American Express (AXP). This agreement would allow American Express customers to send money and pay credit card bills with existing Venmo balances. It would also enable PayPal users to access American Express tokens and use American Express rewards points for PayPal purchases.
Both PayPal and American Express reported their third-quarter results on October 18 after the market closed. Both companies delivered better-than-expected earnings and revenues in the quarter.
PayPal’s partnerships and agreements
PayPal’s partnership followed the company’s recent collaboration with retail giant Walmart (WMT), which allows PayPal users to deposit cash as well as withdraw money from a Walmart store for a $3 transaction fee.
PayPal has entered into similar deals with Visa, Mastercard, and Discover. In September, PayPal completed its largest acquisition—Swedish payments firm iZettle for $2.2 billion.
These acquisitions and partnerships have improved the company’s position in the digital payments space and have strengthened the company’s customer base.
PayPal’s customer base
PayPal’s (PYPL) customer base grew in the third quarter. PayPal added ~9.1 million net active customers, ending the quarter with 254.0 million active customer accounts. Apple Pay, which is one of PayPal’s competitors, has more than 252.0 million users globally. Alipay, owned by Alibaba (BABA) affiliate Ant Financial, had more than 700.0 million users at the end of September.
Amazon (AMZN) launched its online payment processing service, Amazon Pay, in 2007. This service is available in the United States, Ireland, France, Germany, Italy, Austria, Japan, Spain, India, and the UK. PayPal competitor Google Pay also enables users to make payments with Android phones, tablets, or watches.