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What Does PayPal-Walmart Partnership Mean to Users?



PayPal teams up with Walmart

Mobile payments company PayPal (PYPL) partnered with retail behemoth Walmart (WMT) on October 11 to allow PayPal users to deposit cash as well as withdraw money at a brick-and-mortar store. The companies’ partnership could prove a boon to millions of customers who rely on PayPal for digital cash transactions and Walmart for their everyday needs. Furthermore, the coming together of the two behemoths could further boost their businesses.

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PayPal users at Walmart

As a result of this partnership, users that have the PayPal mobile app and the PayPal Cash Mastercard can take advantage of cash-in and cash-out services from their accounts at Walmart stores, including Walmart service desks, ATMs, and cash registers. Users will be charged a $3 transaction fee for every transaction. This is the first time PayPal customers will be able to access their digital wallet at a brick-and-mortar store. While PayPal’s cash-in service is not available at Walmart stores, the cash-out facility will be available by early November.

For Walmart, the partnership is part of its efforts to enhance its digital payment services and could increase customers at its brick-and-mortar stores. The company already offers its Walmart2World money transfer service and Walmart Pay mobile payment system to support the company’s e-commerce efforts.

PayPal’s increasing user base is aiding growth

PayPal’s customer base has been growing since it spun off from eBay (EBAY) in 2015. The growing customer base on the back of its Venmo, Choice, and One Touch users, along with strategic partnerships and acquisitions have been driving the company’s growth. In the second quarter of 2018, PayPal’s active customers were 244 million, higher than the 212 million users in the corresponding quarter last year. Plus, the rapidly increasing smartphone and Internet usage on a global level has also bolstered the company’s payment solutions.

PayPal expects revenues in the range of $3.62 billion to $3.67 billion and earnings to lie within the range of $0.53 to $0.55 per share for the third quarter of 2018. The company is expected to release results on October 18.


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