$13.094 billion (2017)
How they do it: When a merchant accepts a payment via PayPal (e.g. for his E-Commerce shop), the funds are first collected from the customer’s PayPal balance or credit card. Only after PayPal asserted that the payment is genuine and it received the funds from the customer, the payment is ”deposited” virtually in the merchant’s account. Subsequently, the merchant may then transfer the funds to his regular bank account. Both merchant and customer balances lead to PayPal holding an immense amount of funds ”virtually” on his platform, before the funds are at a later stage liquidated or transferred away from the platform.
How they do it: Paypal’s offering to its customers is to provide a solution for the payment process. This solution is available to both private customers for peer-to-peer transactions as well as all kinds of merchants who can integrate Paypal as a payment solution to their online shop.
Leverage Customer Data
How they do it: Paypal’s customer data provides the company a broad overview of individual financial reliability. This allows the company to provide its customers a seller guarantee which allows customers to claim back their payment made via the Paypal service.
How they do it: Although Paypal’s main offering is towards small businesses and merchants it also allows individual consumers to do peer-to-peer transactions from one Paypal account to another. This brings more customers to the platform in the first place and also allows Paypal to increase its transaction volume and account volume on the platform.
How they do it: Paypal, known for its peer-to-peer payment service offers full payment solutions to its customers. With one single merchant account, customers (businesses and private individuals) can access a wide range of features and services such as seller protection through PayPal and check-out solutions for onlines stores.