PayPal is one of the biggest online payment processors worldwide. Many brands and sellers use the company across marketplaces, stores, and other environments. However, it now seems Paypal aims to purchase Xoom, a US-based online money transfer technology provider.
PayPal Will Pay Top Dollar For Xoom
Most people who have sent money online will know the Xoom brand. It is a convenient platform to transfer money worldwide, although it is a direct competitor to platforms like PayPal. So it is not surprising to see the industry giant acquire its competitors, although the price tag of $890 million is quite steep.
The acquisition of Zoom will let PayPal offer a wider variety of services to customers worldwide. Moreover, the company can enhance its customer engagement and focus on expanding into a new marketplace. Zoom is active in several dozen countries where PayPal can make bigger inroads, including Mexico, India, China, and Brazil.
Like PayPal, Xoom enables users to transfer money between friends and family members. However, PayPal’s approach is more on the commercial side of the spectrum rather than “convenient payments”. From that viewpoint, the Xoom acquisition makes sense, as the money transfer giant can focus on all verticals. Whether that will affect PayPal’s rather steep fees for most transactions remains to be seen.
Moreover, Xoom enables users to pay bills internationally, reload their phone credit, and offer the same to friends and family worldwide. It is unclear if any of this functionality will change once PayPal completes its acquisition of the firm. While both parties have an agreement to complete the acquisition, it has yet to be approved and finalized by policymakers.