PayPal Launches X-Border Payment Collaboration With TerraPay
PayPal and TerraPay are teaming to promote cross-border payments in the Middle East and Africa (MENA).
The partnership, announced Tuesday (April 15), is designed to speed cross-border money movement, while making payments more accessible by connecting banks, mobile wallets and financial institutions.
“The Middle East and Africa are at the forefront of the digital transformation, yet financial barriers still limit growth for many,” Otto Williams, senior vice president and regional head and general Manager for the Middle East and Africa at PayPal, said in a news release.
“At PayPal, we’re committed to changing that. By partnering with TerraPay, we’re making it easier for businesses and individuals to make cross-border transactions, quickly, securely, and without friction.”
According to the release, the partnership will see TerraPay — via secure PayPal account linking — act as an enabler, allowing mobile wallet and bank users across the MENA region to transfer funds to their PayPal accounts.
This collaboration, the companies said, will promote financial inclusion, allowing businesses and consumers “to participate more effectively in the global digital economy.”
Recent research by TerraPay and PYMNTS Intelligence shows that 42% of consumers prefer to send cross-border payments via digital wallets.
It’s a figure that leaves a “staggering greenfield opportunity of 58% of individuals,” as PYMNTS wrote earlier this month, one that “stretches across 5.2 billion mobile wallet users and trillions of transactions, as people travel, conduct cross-border commerce and send remittances.”
The research shows that consumers typically use digital wallets for smaller-value remittance payments versus other methods, which indicates “they are becoming the go-to for routine, lower-stakes international transfers,” as PYMNTS wrote recently.
In addition, consumers who are more familiar with digital wallets overall are more likely to use them for cross-border transactions, a sign that rising digital literacy will fuel greater adoption.
But as Ani Sane, co-founder and chief business officer at TerraPay, said in a recent interview with PYMNTS CEO Karen Webster, moving money is about more than just the transaction:
“It’s about compliance, regulations and reconciliation, and settlements and scheme rules.”
Building a network to handle those complexities is no easy undertaking, considering, as Sane said, digital wallets function in silos, on the regulatory and technological sides of the equation, as they’re designed to work in a particular country.
Sane also touched on the ability of digital wallets to promote financial inclusion.
“When you look at the underbanked and underserved segments” of the world, “and you look at mobile wallets [held] by that segment, it matches up almost 100%,” said Sane.
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