PayPal and Visa announced several new initiatives as part of a partnership deal aimed at thawing their historically frosty relationship.
PayPal will de-emphasize its focus on steering customers to bank transfers instead of Visa cards to fund transactions, integrate Visa’s mobile payments platform, provide more transaction data to card issuers, and allow Visa’s debit cardholders to move funds instantly. PayPal admitted that the likely conversion of transactions from bank transfer to credit cards will generate increased expenses to the company. However, access to Visa’s mobile payments technology could improve PayPal’s penetration in brick-and-mortar merchants.
Visa agreed to volume-based price and other incentives and “greater long-term Visa fee certainty” as part of the deal.
The companies will continue to market their competing ecommerce checkout technologies to merchants.
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