James’ Newsletter

A collection of this week’s interesting articles and headlines in the payments industry. I work at PayPal but my views and opinions are my own.

Chinese Wallets. Chinese wallets, Alipay and Wechat, drove significant growth in finance apps downloads in China according to App Annie. With the growing number of Chinese tourists travelling abroad, both companies are extending their reach into foreign markets by providing their wallets to overseas merchants. This includes WeChat announcing a deal this week with Tourism Toronto. John Stewart has written a good summary of this overseas expansion by Alipay.
App Annie Link 
Canada Link 
John Stewart Link

Android Pay. Last year Android Pay announced partnerships with Visa Checkout and Masterpass, this was followed recently by a similar partnership with PayPal. This week at Google I/O the partnership with PayPal was extended so that Android Pay users could pay at millions of websites accepting PayPal (so long as their Android Pay wallet is funded by PayPal). This is a great win for Android Pay as it greatly increases its online acceptance network. The benefit to PayPal is that users will now be able to use their fingerprint to confirm transactions rather than using their email address and password. It also encourages Android Pay users to fund their wallet with PayPal rather than an alternative funding source, and thus is an attempt to stay relevant if Android Pay properly catches on with consumers. US Bank also made a cryptic announcement about its customers being able to link Masterpass accounts to Android Pay… wasn’t this already possible? Presumably the benefit is simplifying the linking process of Masterpass and Android Pay from within a customer’s US Bank account. But I’m still not sure… 📱
PayPal Link 
US Bank Link

Gen Z. I’ve not seen many reports on Gen Z’s attitudes. But Amex has just released a study on how that generation is reshaping brand experiences. Amongst other findings, 33% of Gen Z have used a mobile wallet such as Apple Pay, Samsung Pay or Android Pay in the last month. 👶 Link

Apple Pay. Italians will now be able to use Apple Pay. This brings the number of countries with Apple Pay to 16. Android Pay hasn’t yet launched in Italy. Link

P2P payments. Social payments app Verse has closed $20.5m in funding. I’m sceptical about the monetisation route for these P2P players. There are a lot of costs involved in processing these payments and these costs continue to increase as companies grow. There are a limited number of success stories — mainly involving selling out (Braintree / Venmo; Airbnb / Tilt) — whereas there are many who have failed or seem to be surviving with very limited growth. Link

Next gen payments. According to Barclaycard, SME’s are missing out on £1.6 billion by not accepting next gen payment technologies. 💸 Link

Starbucks. The payment system went down at some Starbucks stores. But Starbucks made sure customers could still get their caffeine. Phew. ☕☕☕ Link