PayPal has been talking about its “super app” plans for some time, after recently telling investors that its next digital wallet and payment app has launched. Today the first version of this app is officially launched, offering a combination of financial tools including direct deposit, bill payment, digital wallet, peer-to-peer payments, shopping tools, cryptographic capabilities and more. The company is also announcing its partnership with Synchrony Bank for its new high-yield savings account, PayPal Savings.
These changes shift PayPal from being largely a payment utility that adds to other offerings here and there, to a more comprehensive financial app. While PayPal does not aim to be a “bank,” the new app offers a range of competitive features for those who plan to transfer their finances to neobanks, like Chime or Varo, as it will now also include the plug. in charge of direct deposits of paychecks via PayPal. banking partners, bill payment and more.
By enabling direct deposit, PayPal users can be paid up to two days earlier, which is one of the biggest draws among those considering digital banking apps over traditional banks.
In addition to transferring their paychecks to Payal, customers’ PayPal funds can then be used for things that are a part of everyday life, like paying bills, saving money, or shopping, for example.
The enhanced bill payment feature allows customers to track, view, and pay bills from thousands of businesses including utilities, TV & Internet, insurance, credit cards, phone, and more. , according to PayPal. When bill payment first arrived earlier this year, it provided access to thousands (single-digit) of billers. Now, it will support around 17,000 billers. Customers can also discover billers with an improved smart search, set reminders to be notified of upcoming bills, and schedule automatic payments for bills they need to pay regularly. Invoices should not only be paid from funds currently in the PayPal account, but can be paid through any eligible funding source already linked to their PayPal account.
Through a partnership with Synchrony Bank, PayPal Savings will offer a high-yield savings account with an annual percentage return (APY) of 0.40%, more than six times the national average of 0.06%, according to the company. . However, this is lower than the main competitors in the digital banking market offering, like Chime (0.50%), Varo (starts at 0.20%, but users can qualify to get 3.00% APY) , Marcus (0.50%), Ally (0.50%), UN (1.00% or 3.00% on autosave transactions) and others. However, the rate may appeal to those leaving a traditional bank, where rates tend to be lower.
PayPal believes its high-yield offering will be able to compete not on APY alone, but on the strength of its bundled offers.
“We know that about half of customers in the US don’t even have a savings account, let alone one with a very competitive rate,” notes Julian King, SVP Consumer at PayPal. “So overall, we think that by bringing together all the solutions on the platform, it’s a really competitive offer for an individual.
The app has also been revamped to accommodate new and upcoming features.
It now has a personalized dashboard providing an overview of the customer’s account. The wallet tab allows users to manage direct deposits and connect funding sources such as bank accounts and debit and credit cards, as well as the ability to sign up for own debit, credit and credit cards. PayPal payment. And a Finance tab provides access to previously available high-yield savings and crypto capabilities, which allow users to buy, hold, and sell Bitcoin, Ethereum, Bitcoin Cash, and Litecoin.
The payments tab, meanwhile, will contain much of PayPal’s traditional feature set, including peer-to-peer payments, international remittances, charitable and non-profit giving, as well as bill payment and a two-way messaging feature that allows users to request payments or say thank you after receiving a payment, whether between friends and family or between merchants and customers. This addition could bring PayPal closer to Venmo, owned by PayPal, which already offers the ability to add notes to payments and provide comments.
Messaging is also tied to PayPal’s new mall, where the company is finally leveraging its $ 4 billion acquisition of Honey in 2019. Honey’s core features are now part of the PayPal mobile experience, including personalized offers. and exclusive rewards.
PayPal users will be able to browse discounts and offers in the app, then make purchases and transactions through the in-app browser. Offers can be saved to the wallet for future use, so they can be applied whether you shop later in the app or online. Customers will also be able to join a loyalty program, where they can earn cashback and PayPal purchase credit on their purchases. The company says these personalized offers will improve over time.
“We will use AI and [machine learning] abilities to understand what kind of buying offers are most appealing to customers and to continue to develop that over time. They will get smarter and smarter as the product is used more and more, ”notes King. This will include using data about deals that a customer likes and then showing them similar deals in the future.
Another new addition to the updated mobile app is the addition of PayPal’s participatory fundraising platform, the Generosity Network, which first launched late last year. The network is PayPal’s answer to GoFundMe or Facebook fundraisers, offering tools that allow individuals to raise funds for themselves, for others in need or for organizations like small businesses or associations. charities. The network is now also expanding to international markets with Germany and the UK to begin with, with more countries to come.
As PayPal has said, the new app sets the stage for other new products in the coming quarters. The biggest initiative on its roadmap is a plan to enter the investment space, to compete with other mobile investment apps, like Robinhood. When that happens, it will take over the ability to buy stocks, fractional shares and ETFs, according to PayPal.
It will also later add support for paying with QR codes, like Venmo, and tools for using PayPal to save in-store.
The updated app is rolling out starting today in the US as a phased release that will end in the coming weeks. However, PayPal Savings will not be available immediately – it will be arriving in the US in the “next few months,” as will some of the shopping and rewards tools.