Paypal Case Analysis

Trevir Nath Universal presence of the internet has transformed landscape of consumer industries. Consumers are provided a means to purchase goods or services through mobile apps and internet platforms. Likewise, innovation has driven a dramatic shift in the way individuals and consumers make payments. The decline of cash and check payments has come in favor for the shift to payment apps and ecommerce. It is estimated that cash based transactions will decrease in the U.S. from $1.4 trillion in 2014 to $1.34 trillion in 2018. As an early developer of online payments, PayPal has paved and revolutionized the industry. Globally recognized companies, Apple (AAPL) and Google (GOOG), are establishing a large foothold in the payments industry with

WePay differentiates its business model from the way payment accounts can be set up. Traditional payment models tie and individual name to one account. However WePay provides a means to separate payments between multiple groups or even personal transactions. Accounts are still tied to an individual name, but transaction history is separated by different accounts. With the rise of online marketplaces and crowdfunding websites, WePay not only provides individual supports but small business services. The company operates as the back office for payment processing of ecommerce websites. Due to the declining nature of cash and check payments, electronic payments popular utilization has resulted in WePay’s rapid growth and

WePay generates revenue from transaction fees on credit card and ACH payments. Credit card payments generate 2.9 percent plus 30 cents in fees while ACH bank payments generate 1 percent plus 30 cents in fees. Besides transaction fees, WePay does not charge additional or monthly fees. In the crowdfunding space, it is estimated that WePay has grown 276 percent in payment volume from 2013 to 2014. Furthermore, it is forecasted that WePay will triple its revenue by the end of 2014. WePay’s rapid financial growth has come largely operating in ecommerce for small businesses and crowdfunding