Top online payment corporation PayPal is leading the adoption of digital technology as cashless payments rapidly evolve as an essential service.
One profound change is the dramatic acceleration from physical to digital, and with the pandemic, the current environment has rapidly accelerated the movement, according to Cameron Mclean, PayPal vice president for International business.
“We are significantly investing to accelerate our presence in all forms of omni-channel commerce, from point-of-sale in-store to buy online and pick up in store, order ahead, pay at table and home delivery. We also understand the impact that the crisis has had on small and medium merchants. We value our partnerships with marketplaces as they have the ability to enable small and medium merchants to go digital, offering them a level playing field by giving them access to a global consumer base and in turn drive greater inclusion,” he said.
McLean leads PayPal’s international business across 177 markets, which include parts of Europe, the Middle East and Africa, Asia and Latin America.
At the height of the global health crisis, PayPal teamed up with the global #GivingTuesdayNow initiative to help communities, SMEs and charities who were directly impacted by COVID-19. In just a day, the global PayPal community raised over $65 million for the cause.
As the COVID-19 outbreak greatly increased PayPal customers across the globe, hackers saw more opportunities to scam people with malware and phishing attacks, McLean said.
According to a report from Google, these shady activities have been successful. Google found that there were 149,195 active phishing websites in January, rising by 50 percent in February to 293,235 websites. In March, there were 522,495—a 350 percent increase since the beginning of the year.
McLean said the world has accelerated from physical to digital across multiple industries, including retail, “but the offers of digital shopping and payment methods is not enough. Companies need to also make these digital methods simple and intuitive; consumers want excellent user interfaces that are easy to use.”
“It’s important to PayPal that our customers are aware of the key cybersecurity issues and tactics used by hackers so both our merchants and consumers can safeguard themselves and address vulnerabilities. We constantly monitor for suspicious account activity to thwart fraudulent transactions, compromised accounts, illegal activity, and violations of our Acceptable Use Policy,” McLean said.
PayPal said that while digital adoption is accelerating, hackers have also become more active that pushed the company to educate both merchants and consumers on possible frauds they could face besides deploying newer technologies to deal with fraud.
In the Philippines, PayPal has actively engaged with 25 banks to make it more visible, locally.
For Xoom, a PayPal service, the Philippines is one the world’s top three remittance destination markets, with 10 percent of the Philippines’ GDP coming from overseas remittance from the US, the UK, Canada and Europe.
To ensure that clients are able to access their funds instantly, PayPal has waived certain fees to increase their cash flow and increased their protections against refunds and chargebacks.
“Our focus is also to enable small and medium businesses to leverage the global opportunity by giving them access to our 300 million consumers across 200 markets. The COVID-19 crisis has been like an inflexion point for digital adoption across these markets, with some studies showing nearly 70 percent of SMEs across APAC having digitalized due to the pandemic,” McLean said.
PayPal’s market research indicates that there is a 50-percent lift in consumer willingness to buy when PayPal is present at checkout, regardless of how they intend to pay.
“Our 10-day adoption rate for our newest cohorts grew by 20 to 30 percent over last year. And across our PayPal base, our daily active users have accelerated by almost 40 percent from last year,” Mclean said.
There are numerous market research studies highlighting that consumers no longer want to handle cash or other forms of payments that require any physical touch at checkout.
Despite the global crisis, PayPal saw the strongest quarter ever since it became an independent public company five years ago, with 21.3 million new customers in the second quarter of 2020, increasing nearly 140 percent year-on-year.
“Our new merchant number this quarter is almost three times larger than a typical quarter, which shows how merchants are adapting their business models, moving from physical retail to e-commerce. In numbers, that is 1.7 million merchants added, with a pronounced spike in the small business category,” said McLean.
The company’s cross-border trade continues to empower small businesses, enabling an expanded customer base as it opens doors to international markets.
