Tag: braintree

Banks are beginning to take mobile payments seriously

Several large banks are working to serve mobile consumers better

Major banks in the United States are beginning to take the fight to the mobile payments space after resting on their laurels for several years. Banks had been wary of introducing innovative services and platforms in the past due to the financial crisis of 2008. Now, however, banks are finding that the mobile commerce space has the potential to be quite disruptive. While the mobile commerce space is intrinsically connected to these banks, they want to ensure they can compete on a level that the mobile commerce space has been able to corner, and that involves engaging consumers more effectively.

Banks are beginning to make use of the clearXchange system

For years, mobile commerce companies have made it possible for consumers to send and receive money almost instantaneously. Peer-to-peer payment services have become very popular among young consumers, many of whom rely very heavily on their smartphones. Banks see this as an opportunity, and many have begun to use the clearXchange system, which allows for instant money transfers to friends and families. Customers with U.S. Bancorp and Bank of America can now send money instantly thanks to the new system. JPMorgan and Capital One Financial plan to begin using the system later this year.

PayPal highlights the success companies can find in the mobile commerce space

American banks and mobile paymentsThe reason the mobile commerce space has become more important to banks is because consumers are becoming more mobile-centric. In the early days of mobile commerce, PayPal managed to find significant success and growth by engaging mobile consumers. In 2013, PayPal acquired mobile payments firm Braintree, which had control of the Venmo mobile application. Last year, Venmo processed more than $7.5 billion in money transfers between consumers. In January of this year, some $1 billion in money transfers had been handled by Venmo.

Banks want to find the same success that PayPal has seen over the past few years

The success PayPal saw through its early acquisitions is something that banks want to mimic, especially as more consumers become involved in the mobile commerce space. These banks will have an uphill battle, however, as many consumers have already become comfortable with the mobile payments services they are currently using.

PayPal acquires mobile commerce firm Modest

Successful acquisition of Modest may improve PayPal’s presence in the mobile commerce market

PayPal has announced that it has acquired mobile commerce startup Modest. The Modest platform was designed to make mobile shopping much more convenient, introducing the concept of “contextual commerce,” which involves the use of contextual information in order to engage consumers more effectively. Modest has become a specialist in this aspect of the mobile space and has enabled merchants to sell products in an effective manner on a variety of platforms.

PayPal continues to establish dominance in the mobile payments field

PayPal has established a very strong presence in the mobile commerce market, having been an early pioneer of mobile payments. The company has been making several acquisitions in recent years in order to establish a greater foothold in this space. In 2013, PayPal acquired Braintree, which augmented the company’s position in the mobile commerce space and gave PayPal access to promising new technology that is being used to facilitate transactions.

Contextual commerce could become a powerful tool for PayPal

Mobile Commerce AcquisitionRegarding the acquisition, PayPal sees a great deal of promise in contextual commerce, believing that it represents a new frontier for the overall commerce space. This frontier is growing quickly and Modest is one of the few companies that have managed to establish a prominent foothold in this growing sector. The acquisition of Modest may allow PayPal to provide better services to merchants that are becoming more interested in engaging mobile consumers, but how PayPal and Modest will work together is not yet clear.

Modest will further augment PayPal’s ability to serve mobile-centric merchants and consumers

Modest allows its users to construct mobile applications or integrate an online store into their existing application. This allows them to sell products through editorial content on blogs or through advertisements and similar content, leveraging the power of “buy” buttons that have begun gaining popularity in the mobile media space. The Modest team will be working with Braintree in order to make mobile payments for PayPal more comprehensive. This represents the first acquisition that PayPal has made since it split from eBay.