Difference between revisions of "PayPal"

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==Ethical Concerns==
 
==Ethical Concerns==
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Since its conception PayPal has continuously been scrutinized for its ethical practices and many of its features and services have been controversial for straying away from traditional standards. Issues such as fraud protection, financial security and information privacy have been major points of contention and have sparked mainstream media attention on several notable occasions.
  
 
===Fraud===
 
===Fraud===

Revision as of 03:34, 21 February 2017

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PayPal Inc.
PaypalLogo.png
PayPalHQ.jpeg
"PayPal Inc." Site
Type Financial Services
Launch Date December 1998
Status Active
Product Line Payment Services
Credit Cards
Platform Financial Services
Website www.paypal.com

PayPal is an American e-commerce service which enables users around the world to send and receive payments and money transfers over the internet. Initially founded in 1998 by Max Levchin, Peter Thiel, Luke Nosek and Ken Howery, the company was then taken public in 2002 and was bought by eBay later the same year. In addition to servicing online financial transactions between individuals, PayPal also operates as an intermediary between online businesses and customers. As of 2017, PayPal has nearly 200 million registered users and allows transactions in 25 different currencies. The company is currently headquartered in San Jose, California and has 18,000 employees.

History

PayPal initially was founded under the name Confinity in 1998 as a company which developed cryptography services used for making Palm Pilot payments. It was not until 1999 when the company officially launched and adopted the name PayPal as a money transfer service. The following year, Confinity merged with Elon Musk’s company X.com, adopted its name and began solely focusing on further research and development into the PayPal product. After a corporate restructuring in 2001, the company decided to change its name one last time to PayPal Inc. since many of its surveyed consumers found the name X.com to be vague.

With only 600 employees and $50 million in revenues during the final quarter of 2001, PayPal Inc. decided to file for an IPO and was taken public in 2002 with share prices of $13. Upon becoming a public company, PayPal Inc. was soon acquired by the online auction and shopping website eBay and quickly grew to become the primary method of payment used on the site as eBay gradually phased out its own competing payment service Billpoint. PayPal Inc. remained a subsidiary of eBay until 2014, when eBay and its board decided to separate the two companies allowing PayPal Inc. to become its own individual public company.

Services

Since its initial inception as the payment service used for eBay transactions, PayPal Inc. has vastly expanded and branched out into multiple other product lines offering an array of different and more advanced services. Using the $60 million raised during its first IPO, PayPal Inc. launched an aggressive and unique marketing campaign to expand its user base. The company created a referral program which offered $10 to each new user who signed up for PayPal and added a credit card to their account as well as $10 to the person who referred them. This strategy used until late 2003 was a tremendous success and led to a 7-10% daily growth rate in customers and ultimately increased the PayPal user base from 100,000 members to over 100 million by 2010. Over this time period, PayPal began offering numerous new services including:

Peer-to-Peer Services

PayPal supplemented its original business model, consumer to vendor transactions, by allowing individual users to send and receive online payments between one another.

PayPal Credit

PayPal Credit is a virtual line of credit for consumers to use at all of the online vendors that accept PayPal. The PayPal Credit service essentially emulates the same experience of online shopping with an ordinary credit card.

PayPal Here

PayPal Here is a mobile payment system intended for small businesses similar to the Square Reader. The system includes an app for businesses to process and track its sales as well as a physical card reader which plugs into the headphone jack of a smart phone or tablet.

PayPal Mobile

PayPal Mobile which started in 2004 provided PayPal users a method of making and receiving payments via text messages through their cell phones.

PayPal MasterCard

The PayPal MasterCard is a debit card which can be used by the holder to withdraw funds from their PayPal account at any MasterCard ATM.

PayPal App

The PayPal App allows users around the world the ability to make mobile payments to one another as well as to make mobile payments to participating vendors.

Venmo

Venmo is an app owned by PayPal Inc. as a result of the acquisition of Braintree for $800 million in 2013. Venmo is similar to the PayPal app in servicing payment transactions between individuals, however it does not allow for transactions from individuals to vendors. Additionally, Venmo has a unique social media aspect to it by posting the users' transactions chronologically in a news feed style. PayPal also provides PayPal Digital Gifts, a system to buy and send gift cards online for hundreds of brands.

Ethical Concerns

Since its conception PayPal has continuously been scrutinized for its ethical practices and many of its features and services have been controversial for straying away from traditional standards. Issues such as fraud protection, financial security and information privacy have been major points of contention and have sparked mainstream media attention on several notable occasions.

Fraud

Security

Privacy

References

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