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Verticals outside of retail, such as financial services (e.g., Chase, PayPal) and travel (e.g., Lyft, Expedia), are increasingly leveraging their first-party transaction-based data to launch media offerings of their own. Non-endemic advertising is a natural fit for sectors that have access to purchase-based data but don鈥檛 sell products directly to consumers.

PayPal. Similarweb. Toluna. Unidays.

Commerce media became an even bigger trend when PayPal announced its own advertising venture in May. Like retailers, these financial institutions have extensive first-party data and want to monetize it. 鈥淎nyone who has access to first-party purchase data has to be thinking through how they can monetize and productize that data,鈥� our analyst Sarah Marzano said after the Chase announcement.

PayPal. TD Bank. Venmo.

PayPal. PYMNTS.com. The Financial Brand. Treasury Prime.

From Apple to PayPal to Paze, wallets are introducing passwordless authentication that can be applied across mobile operating systems. 9. GenAI integration will supercharge search and transform the market. Sophisticated multimodal models are on their way. Despite early fanfare around genAI, the search market hasn鈥檛 fundamentally shifted鈥攜et.

Many financial apps, including Klarna, Revolut, PayPal, and a few others (e.g., X, the platform formerly known as Twitter), hope to become super apps. If they succeed in establishing full-service financial portals, consumers will likely spend more time in them, monitoring finances or even shopping marketplaces.

With JPMorgan Chase and PayPal launching their own ad networks, programmatic ad professionals are looking at commerce media, where companies with first-party data launch media networks. Omnichannel retail media ad spend will grow by 26.0% this year, per our March 2024 forecast.

PayPal is falling off the P2P growth curve鈥攂ut it can still be a powerful supplement to PayPal鈥檚 more advanced features. PayPal鈥檚 eponymous P2P product counts just a fraction of the volume of its peers, and growth is flat, per our forecast. P2P isn鈥檛 a priority for PayPal users. Fifty-seven percent of US adults use PayPal, per Pew.

In 2023 alone, Block-owned Square, Fiserv-owned Clover, PayPal, Stripe, and JPMorgan all expanded their Tap to Pay acceptance capabilities. This casts a net far wider than the smallest businesses, tempting larger ones to adopt the technology for use cases such as on-demand delivery and in-aisle solutions. What does it mean for payment providers?

It also offers customers third-party payment processing integrations through Stripe, PayPal, and Square. This will likely change with the launch of Squarespace Payments. The proprietary solution鈥攚hich Squarespace plans to launch by year-end, per its Q1 2023 earnings call鈥攕hould make it a payfac. This would enable the company to turn more of its over $3 billion in sales into payments revenues.

Cards also help online payment brands like PayPal, Block, and Venmo make in-store inroads. Affirm users can even upload virtual cards into Apple Pay and Google Pay to pay in-store鈥攁 workaround for when Affirm is not accepted at checkout.

Its entry would likely dampen BNPL growth prospects for Klarna, Afterpay, and PayPal鈥攁nd spell doom for BNPL providers lacking broad wallet ecosystems. Gen Z will be the primary growth driver, but cross-generational marketing could bring more older consumers to BNPL. The number of Gen Z BNPL users will grow by around 64% from 2023 through 2027 to nearly match millennial users.

PayPal. PYMNTS.com. Reuters. Seeking Alpha. Strike. The News & Observer. The New York Times. United Nations. US Securities and Exchange Commission. Visa.

Digital wallets such as PayPal, Apple Pay, Samsung Pay, and Google Pay have made paying by mobile easier and more secure. People are spending more time on their smartphones. In 2023, the average UK adult will spend over three hours a day on their smartphone, per our forecast. That鈥檚 up from 2 hours and 18 minutes (2:18) in 2019. To view the time spent with smartphones forecast, click here.

What鈥檚 in it for PayPal? Allowing spend on a competing wallet may seem counterintuitive: PayPal will lose out on those transaction fees, and it may reduce loyalty between the PayPal or Venmo cardholders and their associated wallets. But letting its cardholders use Apple Pay can bring key benefits to PayPal that the company hopes will outweigh the losses.

The news: PayPal is piloting and bringing to market later this year six innovations that use artificial intelligence (AI), per a press release. Enhanced checkout. PayPal upgraded its checkout experience, using AI to remove friction points like password prompts and lagging response times. Fastlane by PayPal. This is a one-click checkout experience that merchants can offer.

They鈥檒l be more likely to create a regular Venmo account when they鈥檙e old enough, and it gets them into the PayPal ecosystem. The accounts will also help PayPal compete against Block-owned Cash App, which launched teen accounts in 2021. We expect Cash App鈥檚 user growth will outpace Venmo鈥檚 this year, jumping 10.7% YoY to hit 45.5 million US consumers.

Amazon, PayPal, and Visa have joined advisory groups with the Bank of England to explore a CBDC in the UK. Invest in blockchain technology. Blockchain-based payments are the future, regardless of a US CBDC鈥檚 existence. Incumbents like Mastercard, PayPal, Square, Stripe, and Visa are already exploring and integrating crypto payments. Advocate for interoperable systems.

PayPal is adding interoperability to its wallets to increase their utility and encourage use. Venmo recently added crypto transfers to other users and external wallets. PayPal launched this feature last year. And through a partnership with Visa+, PayPal will let Venmo and PayPal users to transact with one another later this year. Braintree.