The history of PayPal.

PayPal: A Major Fintech Milestone

Fintech has become a staple of the ever-evolving digital infrastructure of the modern economy. Hundreds of applications and software products are out there today, working tirelessly to handle and manage everyday financial interactions and investment opportunities. While it’s easy to get caught up in the latest and greatest offering of a constantly innovating technology field, one company has stayed strong since its very beginnings.

PayPal Holdings, Inc., known colloquially as just PayPal, not only paved the way for modern Fintech but continues to operate as a dominant force in the industry.

Humble Beginnings 

PayPal was founded in 1998 under the company name Confinity. Financial technology was still in its infancy, and the company’s first focus was instead the security software of handheld devices. This proved unprofitable quickly, and the company pivoted to work on a “digital wallet”. 

In 1999, Confinity launched its electronic payment system, PayPal. This early change in direction proved successful, and the company was merged with online financial service company x.com in 2000. 

In 2001, the company renamed itself PayPal, and in 2002 it went public. By October of that year, eBay had purchased the company for $1.5 billion and PayPal was well on its way to greater success. 

eBay Guides the Way 

In the early 2000s, eBay was an early adopter of a centralized online marketplace. With the help of PayPal, they would soon dominate that market. PayPal allowed eBay to offer secure financial transactions between clients and customers across their platform and the uncertainty that defined the early days of online shopping along with it. Through eBay’s existing presence across the globe, PayPal was able to expand its presence internationally. By 2006, the company offered its services in ten different currencies across the globe. 

With these advances, PayPal sought to become a global player. In 2007, the company was provided with an EU banking license to further expand services to its existing 35 million customers across Europe. That same year, the company concluded a significant deal with Mastercard, enabling customers to pay via PayPal on any website that accepted Mastercard. 

2008 was another big year for PayPal. eBay acquired Bill Me Later, a large digital payment platform that had existed as PayPal’s primary competitor. PayPal was now the undisputed direct money transfer platform worldwide with this acquisition. Over the next decade, PayPal would continue to build on its market lead, offering more international currencies and launching applications on both iOS and Android.

Charting Their Own Course

In 2015, PayPal decided to branch off on its own. The company spun out from eBay in that year and partnered with the Dutch company Ayden as its primary payment processor. Despite its age, PayPal entered this new phase of its lifecycle with expansion and innovation in mind. In 2018, the company acquired Swedish payment start-up iZettle for $2.2 billion. Later that year same year, PayPal purchased Hyperwallet, a popular payouts platform designed for businesses and organizations. 

As a result, Paypal has expanded its operations to a more diverse range of fintech services, ensuring itself a somewhat ageless expansion in the industry. These acquisitions and others have boosted its popularity as a modern payment solutions provider to e-commerce platforms and businesses alike. 

Through this new era of innovation and expansion, PayPal proves that fintech isn’t just about building the latest and greatest software application. It’s also about growth and gradual evolution to fit the needs of the era. Not every company gets left behind in a rush for innovations, and even those existing giants can find new ways to expand their offerings and reach potential clients. 

PayPal has become a consistently proven case study for that sentiment.