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PayPal Holdings Inc. made it clear on Thursday it isn’t done striking deals with banks and other payments companies. Only days after announcing a major partnership agreement with Samsung Pay, PayPal now says it will work more closely with JPMorgan Chase & Co. and the bank’s Chase Pay wallet. And it also announced an expanded relationship with Citigroup Inc. to allow Citi cardholders to spend their rewards points at PayPal merchants. Both agreements are expected to go live next year.
In the Chase deal, which is the more far-reaching of the two, PayPal and Chase will ease the way for Chase cardholders to add their cards to new or existing PayPal accounts. Cardholders will also be able to use their PayPal wallets in physical stores using tokenized credentials. In a blog post, PayPal chief executive Dan Schulman says this capability will arrive via “our forthcoming NFC mobile experience,” without adding details. Contacted by Digital Transactions News, a PayPal spokesperson says, “We have not announced specifics.” NFC refers to near-field communication, a technology that links cards and mobile wallets through radio waves to point-of-sale terminals.
Chase Pay will benefit by gaining access to online merchants serviced by Braintree PayPal’s in-house e-commerce processor and technology developer. Samsung Pay similarly will become a payment option for Braintree merchants under the agreement Samsung reached with PayPal. And both PayPal and Chase will presumably benefit from an agreement to make Chase an acquirer for PayPal volume, which will let the bank’s in-house acquiring arm, ChaseNet, process Chase card transactions from the wallet.
Summing up the whole agreement with Chase, Schulman in his blog post says it “allows us to strike one partnership agreement and reach millions of existing and potential new PayPal customers across the [United States].”
In the Citi partnership, users of Citi’s rewards program, ThankYou Rewards, will be able to redeem their points at PayPal-accepting merchants online or in-app. The deal will apply only to the United States at first, but Jim Magats, vice president and head of payments for product and engineering at PayPal, says in a separate blog post that the partners could expand the program internationally later. “We want to extend the ubiquity of the PayPal platform and support all relevant types of payments that our customers use, which includes credit and debit but also rewards points,” Magats says.
PayPal’s partnership pacts with Chase and Citi are the latest in a string of cooperation agreements that began last summer with Visa Inc. and include Mastercard Inc., Wells Fargo & Co., Discover Financial Services, Fidelity National Information Services Inc., First Data Corp., and Apple Inc., Alphabet Inc.’s Google, and Facebook Inc., in addition to Samsung Electronics Co. Ltd.
Schulman makes it plain more deals are coming. “We will continue to forge new collaborations with players across the industry that share our values of making digital payments and the management and movement of money more seamless and secure,” he says in his post.
