Paypal and Citi may go head-to-head in the digital payment space, but there is at least one thing the payment providers agree on: no one company is going to dominate the global payment market anytime soon. Therefore, the two companies, with HPE Growth Capital, are investing $50 million in London-based PPRO, a fintech company that consolidates different payment methods.
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The increasingly globalized e-commerce market raises the need for a uniform payment solution. Although paying with a credit card is standard practice in the U.S., it only accounts for 20% of worldwide e-commerce transactions, per PPRO’s press release. Cash, bank transfer, and digital payment methods are still popular options in other parts of the world. Because of this diversity in payment methods, international transactions can be very difficult to complete.
PPRO addresses this challenge by processing and collecting payments under a single contract. Through the PPRO platform customers can use PayPal to purchase a pair of shoes from a Dutch shoemaker, and the shoemaker is then able to receive the payment via iDEAL, a popular online payment option in the Netherlands.
Amidst heated competition in the digital payments space, Paypal is betting that its new investment into PPRO will help it become “the one-stop solution for global digital commerce.”
“PayPal is pleased to support PPRO as the company continues to grow,” said Arnold Goldberg, PayPal’s vice president of merchant product and technology, in a statement. “We recently signed a commercial agreement with them to provide a wide range of payment options for our merchants, so consumers can shop seamlessly across borders through the new PayPal Checkout with Smart Payment Buttons, Braintree and all of our merchant products.”
The new “Paypal Checkout with Smart Payment Buttons” presents users with the most relevant payment options at the digital checkout portals.
With the rise of digital payment technology, traditional giants in the payment space are seeing a trend of shrinking payment sizes and increasing payment frequency.
“That dichotomy is presenting a unique challenge to companies in the payments landscape,” Luis Valdich, Managing Director of Venture Investing at Citi Ventures, told Crunchbase News. “How can technology transform these age-old systems to address the way consumers and customers are quickly changing how they pay? Digital commerce and payments, plus the emergence of IoT and real-time payments, are triggering a change in the way banks address how they process payments.”
Founded in 2006, PPRO had only raised one other round in 2014 prior to the latest infusion of capital. However, with the two rounds of funding, the company is already profitable. It has around 200 employees, according to TechCrunch. PPRO accepts 140 alternative payment methods, and it plans to use the new funding to expand its platform and scale its global business.
Piece updated after the time of publication to include a quote from Luis Valdich.
Illustration: Li-Anne Dias
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