[ad_1]

Dive Brief:

  • Card giant Visa is testing a new tool that lets individuals move money between peer-to-peer payment platforms, with digital pioneer PayPal and its Venmo unit piloting the service now, according to a Tuesday press release.
  • The service, called Visa+, will be available to PayPal and Venmo users and doesn’t require them to have a Visa card. The new service will be used by “select partners” late this year and be available more widely by the middle of next year, Visa said.
  • As part of a broader effort to build interoperability between such P2P channels, Visa also noted it has links with other payments players, including the earned wage access company DailyPay and the international money transfer company Western Union. Those are long-standing ties, a Visa spokesperson said by email.

Dive Insight:

While the new link makes sense in that it offers Visa new business, the announcement made analysts wonder why PayPal and its Venmo unit aren’t connecting on their own. “This product seems like a net benefit for Visa by increasing P2P use cases (we didn’t think Venmo/PayPal would need a network in between, so it’s nice to see Visa involved!),” said a report from analysts at the investment firm Robert W. Baird & Co.

A PayPal spokesperson didn’t immediately respond to a question about whether the Visa+ link is the only pathway between PayPal and Venmo, or just one route among others.

Individuals will be able to use the new Visa connection by setting up a payment address tied to their Venmo or PayPal accounts. Then, they can use either the PayPal or Venmo apps to receive and send payments, Visa said in the release.

“Consumers continue to seek simple and seamless ways to digitally move money between friends and family, including the ability to send money between different payment platforms,” Visa’s global head of new payment flows, Chris Newkirk, said in the release. “Through this collaboration, Visa+ can help break down barriers for payment app users as they connect, engage and move money.”

Visa is building its P2P capabilities as its bank card issuing clients attempt to increase use cases for their own P2P tools, including Zelle and its under-development digital wallet sister Paze, which is aimed at enabling e-commerce payments.

San Francisco-based Visa has tapped its California payments peer San Jose-based PayPal in the past to advance new services. For instance, PayPal said earlier this year it would make its cross-border debit deposit services available on a real-time basis by letting U.S. users of its Xoom money transfer service make faster deposits via their Visa debit cards in 25 countries.

Connecting platforms is a key theme in the Visa play, the company said, pointing to the trade group U.S. Faster Payments Council citing interoperability as one of the most important issues for the payments industry.

As for other payments partners involved in its interoperability effort, Visa also mentioned its links to the lender and money transfer business TabaPay and card issuing and consumer credit company i2c.

[ad_2]

Leave a Reply

Your email address will not be published. Required fields are marked *