I'm not sure I like this idea. Braintree is a legit competitor to Stripe. I'm guessing they have some informal agreement to keep transaction fees about the same but if they become 1 company, what's to stop Stripe from raising fees even more?
I'm not a fan of either to be honest, PayPal once told me I was wrong with something related to taxes and a bunch of different reps told me what I was saying and reported was impossible. Their tax division specialists also replied by email with big bold red letters outlining how it's not possible and that I'm wrong multiple times. They were contacted through support cases I opened with other reps on the phone since they aren't directly accessible on phone.
Then I said I was canceling my account with them if this wasn't resolved since it would have resulted in me needing to pay $400 to have my taxes amended. Long story short, after being ghosted for 3 months they replied to me saying I was right and they indeed had the impossible problem, then fixed their tax forms a week before taxes were due.
It's really bad that a random person on the internet discovered a huge issue with one of their partners and their instinct was to require ~10 hours of back and forth phone calls, multiple emails, me giving them the likely problem and solution on day 1 only to be lead on and ignored for months until the very last second.
They've been abysmal and borderline criminal since the start.
They randomly withheld £20k from a business I was involved with for no stated reason and no direct means to talk to a human about it. It took months to resolve.
Why would you keep any money on PayPal. It’s just a pass-through to your bank account, accepting payments without giving your bank details to strangers on the internet.
Of course, but that's the thing about "informal" agreements: presumably there's no record of it. Price collusion happens way more than most realize. I was at a trade show for my employer when a competitor walked up to our booth and out loud proposed that we should all fix our prices. We didn't of course, but the brazenness of saying something like that out in the open like was what surprised me.
The good thing about price collusion is that it's hard to coordinate. If even one competitor defects (and they have every advantage to, as they'll win big), then the cartel falls apart.
One of the big rules of commerce is that competing on price is generally a no-no for large markets. Usually, the powers that be would rather compete on a perceived value; that is how “informal price collusion” works.
Price/cost is the last thing you compete on unless you have a wholesale advantage, which nobody in this particular industry does (visa/mastercard set core rates)
Source: I’ve worked with higher ups in numerous commerce operations.
Commerce is actually even worse than many realize. Look up pepsi and walmart as a small example.
* it instantly brings them a ton of consumers
* they have capacity to serve those customers
if they don't competitor can just keep higher price (especially if it is just small middleman fee most people might not care that much about)
And even if both of those are true worst possible case is them expanding to handle influx of customers and then competition following in few months, making their investment moot
Not good. Stripe makes restrictions that PayPal allows (cannabis adjacent, adult adjacent) that Stripe blocks. Many vendors will be negatively impacted by Stripes morality police and selective application of their policies.
In my experience, having worked at several large PSPs, it is Mastercard and Visa who are the morality police. Stripe are just enforcing the rules insisted on by them, and PayPal forgot about them 3 layoffs ago.
Why do people think this? Since when do giant corporations care about morals?
As usual, everything is about money. You can be sure that part of the interest in a paypal acquisition is paypal's consumer wallet product which allows them to extend into lines of business that are currently constrained by Stripe's model.
There are many bank and bank-adjacent companies who contractually enforce morals standards. It doesn't matter if the underlying reason for the morality is profit maximization, the effect is the same.
You seem to care more about the aesthetics of the sentence than the meaning behind it. We know that a company is not a person. It doesn't have a consciousness. It doesn't have a singular morality to work with. It borrows the decision making of its employees and contractors. We know that the "morality" of a bank or credit card company is really just a layer of abstraction for a group of decisions it makes to avoid bad press/sentiment/oversight/regulation. But if you analyze why people have morality, it's not that different; there are LOTS of things people would do that they currently don't if there was no underlying consequence.
It's not about morals, it's about regulatory heat and risk. Cannabis in the US remains illegal on the federal level, and the chargeback rates on adult services are through the roof.
No, chargeback rates are not the only reason banking companies like Mastercard are dubious about adult content. In 2021 they added contractual terms to ensure that adult content uses age verification, has the consent of the participants, and to remove illegal content before it is published at soon after it is reported.
But also, the financial industry has a history of discriminating against their customers based in moral reasons (or at minimum bowing to regulatory pressure which stemmed from upstream morality decisions).[1]
Or, because as you say it's money (I agree) the Stripe will put their "morals" in place - with the financial result they reduce risk, get less chargebacks and lower costs - then pass the savings on to the C-suite.
Morals, generously interpretation of the usage, was just to indicate that Stripe has a more narrow risk window.
Only an idiot would think it was about actual human-grade morals or ethics. Let alone that there were actual morality police.
It's pretty easy, you get hit with a surcharge on your other transaction volume if you allow something that V/MC don't want you to allow, and if you keep doing it you could get cut off which effectively makes you irrelevant to many of your customers.
As others have said, it's about perceived brand risk (V/MC allowed X terrible transaction to take place) and regulatory risk.
What I find weird about this is that JohnC has been saying for decades that large mergers are pretty bad for both companies. You spend 2,3 years in limbo, figuring out what in the world to do with the other large organization. When Stripe makes acquisitions it's historically been small companies, doing things Stripe isn't doing. It's the kind of situation where pc is unlikely to speak publicly here, but I sure would love to understand what the plan is, if just as a shareholder.
I typically use paypal for paying contractors, but try to "load balance" across a couple competitors because you never know when one of them will flag your account, nor for how long it will be flagged.
Consolidation in this industry puts my ability to transmit money at greater risk.
Paypal was worth near $50 when it IPO again in 2015, and it is still worth $50B today?
And this isn't some inflated market cap either, apart from 2021 and 2022 they have been making $5B+ Net income in the past 6 years. I would love to dive into how Paypal makes money because that is an order of magnitude bigger than I thought. There must be some market in which Paypal is popular and culturally accepted as by default payment.
Which also makes me want to rethink how much Apple Pay is worth if it was a separate business.
If I worked for PayPal right now I'd be printing résumés. Stripe recently laid off 300 of their IT people. To paraphrase Petey Greene, I wouldn't trust them to wash my car.
That would be quite a play. Stripe, PayPal, Venmo, Braintree, Xoom all under one umbrella. The Herfindahl-Hirschman Index (HHI) for online card-not-present (CNP) checkout on that is going to be absurdly high and this will take a lot of convincing to beat antitrust. They will probably have to unwind Venmo and Braintree.
States have the ability to sue to block mergers as well as the federal government. See the recent 11 state lawsuit seeking to block the WarnerMount merger.
Just a couple of months ago, someone was still suing[1] to block Alaska Air/Hawaiian. This is a merger that already entirely went through. I would predict equal likelihood of some state lawsuit derailing a merger like this.
If it isn’t red states the current admin won’t care at all. If it’s mostly or entirely blue states, they’ll just default to siding with the merger out of spite.
Which is funny because regardless of whether or not those states succeed in blocking the merger, those legacy video entertainment businesses will become irrelevant whether they are one business or two, due to the fierce competition from TikTok/Instagram/Reddit/Youtube/Whatsapp/computers/anything on the internet in general.
It's probably the most inconsequential merger, from a consumer standpoint.
Do you have any evidence that you can just bribe your way past antitrust regulations (which are enforced by hundreds or maybe even thousands of attorneys across the political spectrum) or is this just how you feel because you don't like who is in the White House right now?
Added up all the free market enterprise section completed deals where the purchaser was indicated as US based
Obama era:
2009: 6,
2010: 1,
2011: 4,
2012: 1,
2013: 4,
2014: 5,
2015: 7,
2016: 6
Trump term 1:
2017: 4,
2018: 8,
2019: 13,
2020: 7
Biden term:
2021: 4,
2022: 4,
2023: 7,
2024: 4
Trump term 2 so far:
2025: 11*,
2026: 9*
Obama average: 4.25 / year
Biden average: 4.75 / year
Trump term 1 average: 8 / year
*Most of the last two years are indicated as still pending, so not sure if they will go through or not.
Not exactly the most scientific data gathering or study. But it does suggest that large mergers and acquisitions have generally been made more frequently under Trump.
You think they'd only have to go through antitrust in the US? These are global payment processors, and the EU loves getting involved in this kind of thing. And no they can't just ignore it if they want to keep the majority of their customers.
Quite true. Or honestly, it's really barely about direct financial bribery anymore[1] - all the recent ones have just hinged on incredibly naïve (and easily manipulable) readings of how a merger might affect culture war / red vs blue partisanship.
For instance, CNN really doesn't matter, and was a tiny part of WB/Discovery, but of course Trump cares deeply about (hating) CNN, so all that was needed to win over Trump and guarantee his approval was for the acquirer to whisper to him that they'd do a housecleaning there. This lifehack would work for acquiring any company that happens to control any media property that hasn't established itself as a Trump cheerleader.
Note: I'm not even a Democrat today, but the pure and petty corruption on display definitely sickens me.
[1] though, back when it was, the bribes were astoundingly high ROI due to how cheap they were!
If it's a card-not-present transaction, Visa or MasterCard is making the bulk of the commission and forcing the vendor to take on the risk of a transaction without a PIN or password.
At least the others offer the hope that maybe some customers will pay directly from a Stripe/PayPal account, without the high commission and high risk of a Visa/MasterCard network transaction.
>If it's a card-not-present transaction, Visa or MasterCard is making the bulk of the commission and forcing the vendor to take on the risk of a transaction without a PIN or password.
Not true. Visa and Mastercard don't make the bulk of the commission. When a merchant pays a standard 2.9% + $0.30 fee on a credit card transaction the issuing bank gets roughly 1.5-2.5% for interchange, which is the bulk. The processor or acquirer gets anywhere from 0.2-0.5% and the card network gets only about 0.1-0.15.
Also, PayPal does not lower a vendor's commission. If they pay with a PayPal cash balance, PayPal still charges the merchant a premium flat rate (often 3.49%) and simply pockets the entire spread. They don't pass the savings down. And consumer's don't have a Stripe account to pay from, Stripe is probably aiming for PayPal wallets via this move.
Gosh, with such efficiency of operations consumers will win because pricing of their services will be more efficient! Todays Feds will try selling that story.
Nah, I hate them with a passion as a merchant but I absolutely love them as a buyer and customer.
There is a reason why after all these years and other solutions they're still everywhere, and it's not because of their great tooling, their low fees or their awesome support for merchant. It's not because of market lock in either, at least here in Europe they're merely a middle man between my credit card or sepa bank account and the merchant. It's because buyers trust it.
Buyers don't trust stripe. Stripe is for the merchant.
As a buyer I don't trust Paypal. They use dark patterns to try to get me to sign in, then make it hard to sign out, and for whatever reason my account is wedged and even though it has the correct payment details, the payments all fail. The UI is antiquated and the embedded version that has the animated progress bar GIF is sketchy at best. The Venmo app (which Paypal owns) is jammed with crappy ads and an often-broken UI.
The advantage that PayPal offers me as a buyer is a middleman between the vendor and myself that I control. The vendor does not get any of my card or bank info, and if it’s a subscription I can easily cancel it at any time on the PayPal side without having to go through whatever dark patterns the vendor might have to prevent you unsubscribing.
Nah I thought I liked PayPal as a customer until I found out that they favor large merchants against the consumer. I had a problem with a product and the company was playing games with the warranty. I only had it for 3 months and it was already falling apart. I made a complaint with PP and it was auto denied.
I don't know about recently, but for many years paypal automatically sided with the customer.
We had many customers that would buy a 1 month sub then chargeback the whole amount after using it heavily for a few days, with a nonsense reason like "item not as described" or "unauthorized charge".
Yep I had a case where I bought something online and it was not as described. The merchant didn't respond to emails, I filed the PayPal chargeback and the case was taking ages as the merchant wasn't responding. They finally responded on the last day to basically say I got my item. Despite all my evidence I provided it didn't seem to matter. So I again would have to respond and now wait for PayPal to rule. I was getting so sick of it, I just filed a chargeback with my credit card company instead and they gave me the money back right away upfront and did their own investigation after the fact and ruled in my favour.
I have had PayPal work for me for refunds many years ago, but the problem is often how long the whole process takes and how long your money is held hostage. By the time you maybe get your money back, you've already had to pay off that money on your credit card (if you used credit for the PP transaction). I've found that when I do a chargeback via my credit card, they often give me the money back right away and then do an investigation. If it were to not go my way the money would get taken back. I think this feels more fair depending on the case. Some cases are pretty clear cut and there is no reason to hold your money hostage while they confirm what you said is truthful.
As a buyer, I like something that's good for the merchant, because 99% of the time I'm buying from merchants who I trust way more than I trust the other buyers. Don't even want credit card middlemen if I have the choice.
Yeah, any subscription I can push through PayPal, I do so, because I can cancel it directly on their end. I don't need to go through a ten click justification process with the merchant.
I did until October 2022, when PayPal published an update to its Acceptable Use Policy that threatened to fine users $2,500 for promoting "misinformation".
Like they were the arbiters of what is misinformation and worthy of economic penalty. While it was later rescinded, it was beyond the pale. It's proof that something is corrupt and completely out to lunch in their management, and I won't sign up again after deleting my account in protest.
Edit: So apparently they only removed the misinformation clause, and they may still seize $2,500 of your money if they alone decide you are guilty of "...the promotion of hate, violence, racial or other forms of intolerance that is discriminatory or the financial exploitation of a crime...". People are worried about authoritarianism, yet meekly cede such powers to a corporation? It boggles the mind.
And as a consumer, I especially hate PayPal because they always try to screw me with their currency conversion rates by hiding the toggle button (and it happens that I sometimes forget to toggle over to my bank's currency conversion)
And only once have I ever won a payment dispute there (and that was as a merchant, not a buyer... lol)
Back when selling online tech courses was viable (pre-AI), about 30% of transactions in the US were from folks using PayPal on the platform I used. There's a huge of people who use PayPal, it's even more outside of the US.
It's the same argument why Google isn't never considered a monopoly to the online ads space. Because the whole ads industry is much larger.
Same thing with card payments. There are online card payments and in-store card payments and other kinds of payments. Stripe + Paypal volume is considered a fraction of it.
In the US, PayPal has nowhere near the adoption of other countries, for making payments directly between accounts, and Visa and Mastercard have enough regulatory capture to ensure it stays that way.
If there wasn't a regulation-ensured duopoly, everyone would be switching to RTP or FedNow which each charge 4.5¢ per transaction, without an additional commission.
There is no recourse if something goes wrong with FedNow, right? Like you get scammed, and the scammer just keeps the money. Seems like a pretty big difference (in theory anyway) to PayPal. Although I'm apparently not the right guy to ask, since I really don't see the use case for PayPal vs. credit card.
With wechat in china, pix in south america and wero in europe, I think it's quite the opposite. All continents want to see visa and mastercard dead so they can bring back those transaction fees in house and it will work as the phone is the low friction payment method now.
Wero in the EU is fantastic, albeit still very young. Once it's mature and deployed everywhere, I see no reason to use something else in my country.
In fact, in France, the CB system endured despite visa and mastercard for 4 decades, so we know how to do it already.
The deal that a low regulatory executive administration is supporting, while states attempt to prevent it (acting in place of what one would expect from an appropriately functioning Dept of Justice and FTC) until regime change. Midterms are approaching, and this admin has a bit more than two years left. Some folks involved are either at, or beyond, human life expectancy as well. Sort of but not quite similar to Brexit, which barely eeked by, and now all of the old pensioners who supported it are dead after a decade and the country is ready to consider getting back into the EU.
TLDR This low regulatory period of the US political timeline will eventually end, and there will be a lookback/clawback period. Nothing is permanent. Rules can be changed at any time.
I'm not sure how this is a good thing. There are already very limited options to accept payments online, consolidating two of the major ones is not a great thing.
In most countries, Wero is still in incubating stage. i.e., banks anouncing that in the next 3 years they will support it.
Of course it's not widely used by vendors when it's still in development. I am hopeful that it will take off to some degree in the nearest 5 years though.
That is what keeps confusing me when people hype wero. It essentially (I think some limited trials?) doesn't exist for B2C, and sending money to friends is a very minor use case.
So once it has really broad support and can be used as merchant, is when it'll maybe become interesting.
It is not. Wero has charge back support and therefor higher fees. There is quite some interest in Pay by Bank via PSD2 APIs. This is much more similar to iDeal and can work for the entire EU.
In some ways, I would rather Stripe have the market power here to negotiate against Visa & Mastercard than Visa/Mastercard holding the reigns over a fragmented digital ecosystem.
Reading about Stripe’s stablecoin ambitions is funny. X uses Stripe, but Stripe on X doesn't accept my Bybit stablecoin cryptocard for a Pro subscription, ads, or boost purchases.
This would be amazing! Its such a pain having to set up two payment solutions as a merchant and as a buyer it would be great if I could use my paypal credit on whatever purchase I want. Consumers want paypal and merchant want stripe. I really want this to happen.
PayPal has been a payment option offered by Stripe for merchants for a while now. I don't know if there's more setting up than clicking the activation button.
PayPal was worth 5x this a few years ago... Even pre-pandemic it was worth far more. Hell, just a year ago it was valued at ~$80 share.
$60.50 per share would value them at just 11x their current earnings. I get PayPal isn't exactly a growth company anymore, but I'm not sure I understand why shareholders would agree to this offer?
Why, what is the play here? I know PayPal is used extensively in some countries (like Brazil?) but in most countries there are other/local services that have substantial market share and I do not think that PayPal can compete.
Don't forget Venmo - PayPal smartly gobbled that up many, many years ago, and it has a great amount of mindshare (though I don't know how profitable it is). Zelle popped up later and somehow has plenty of users, but unlike Venmo, Zelle is a steaming pile of sh*t of user experience, due to it being a consortium of all the famously-tech-backwards big banks, which stood it up out of fear and jealousy that those "Internet" guys might find a way to disintermediate them somehow.
If I'm buying something from a website and they don't offer Apple Pay, I'll opt for PayPal instead since I already have my credit/debit cards saved there and don't want to hand over numbers to a random website. Also, when I used to do more freelancing, all of my clients preferred to be invoiced and pay through PayPal (who skimmed a decent chunk of change off the top).
Not sure if either of those reasons would be what Stripe wants here, but just my two cents. I'm American fwiw.
Interesting that you'd mention Brazil. I consider it one of the very few examples of countries successfully replacing PayPal with a publicly owned service. Pix is ubiquitous in Brazil and has been for years. It has not only displaced PayPal but also cash and (in large parts) Visa/MasterCard, even in the face of US tariff threats.
It's actually pretty common for local payment systems to exist, it's not just Brazil. I've seen such systems in Europe, Asia, Africa and I'm sure they exist in other places I've never been to
The more time goes on, I'm starting to come around to paypal's original vision of decentralized internet-native money as being the future.
The more the international system breaks down and countries abuse their power via the banking system (especially the US, and from both parties), my opinion of cryptocurrencies transitions from "annoying scam infrastructure for hucksters" to "actually...you might have a point." Still a ton of growing up that needs to be done by the industry.
But no company or country should be able to tax the global economy via payments monopoly and you should not be able to be arbitrarily banned from the economy by these global supra-national intermediaries that have no court system and no democratic levers to pull to reign in their overreach in your country outside of desperate social media posts.
Stripe brags incessantly about how much of global GDP they facilitate...which, cool. I don't doubt there's an insane amount of work required to herd all those global cats and make payments just work. But, they're literally taxing the entire world as a % of GDP due to this dystopian legacy system? Is that the best outcome for humanity?
PayPal is sort of the Facebook of digital payments: they stopped being directly relevant years ago, but own many of the things that you or someone you know continue to use. Venmo being the obvious one, but also Braintree, Xoom, Honey, Bill Me Later, etc.
I've been thru 3 or 4 'lifetime' bans with PayPal. Just ask to be reinstated during the next big shakeup (now) and they'll let you back in. They want your money. They want your business. The exact same things you couldn't sell 25 years ago, the things that got you banned, are now listed online without care. They literally forget.
AI "sez": "PayPal's valuation has declined significantly from its peak of approximately $360 billion in 2021"
haven't been following the drop because otherwise I thought that Paypal was more valuable than Stipe + Advent combined (which seems to have previously been the case) - and so I would have thought Paypal would have been buying the other companies and that this was some weird way to try to devalue a competitor by offering to buy them
I'm not sure I like this idea. Braintree is a legit competitor to Stripe. I'm guessing they have some informal agreement to keep transaction fees about the same but if they become 1 company, what's to stop Stripe from raising fees even more?
I'm not a fan of either to be honest, PayPal once told me I was wrong with something related to taxes and a bunch of different reps told me what I was saying and reported was impossible. Their tax division specialists also replied by email with big bold red letters outlining how it's not possible and that I'm wrong multiple times. They were contacted through support cases I opened with other reps on the phone since they aren't directly accessible on phone.
Then I said I was canceling my account with them if this wasn't resolved since it would have resulted in me needing to pay $400 to have my taxes amended. Long story short, after being ghosted for 3 months they replied to me saying I was right and they indeed had the impossible problem, then fixed their tax forms a week before taxes were due.
It's really bad that a random person on the internet discovered a huge issue with one of their partners and their instinct was to require ~10 hours of back and forth phone calls, multiple emails, me giving them the likely problem and solution on day 1 only to be lead on and ignored for months until the very last second.
Braintree was a legit competitor, last time I checked they won't even onboard you if you don't have an established business grossing over 100k/yr.
Paypal offshored all of their support staff.
They've been abysmal and borderline criminal since the start.
They randomly withheld £20k from a business I was involved with for no stated reason and no direct means to talk to a human about it. It took months to resolve.
And as for their actual website...
Why would you keep any money on PayPal. It’s just a pass-through to your bank account, accepting payments without giving your bank details to strangers on the internet.
The dystopia that PayPal is we’re cheering and paying trillionaires to bring forward faster. Can’t wait.
> informal agreement to keep transaction fees about the same
This would be like, ridiculously illegal. It's also not practical; if you can steal customers, the incentive to undercut is very strong.
Of course, but that's the thing about "informal" agreements: presumably there's no record of it. Price collusion happens way more than most realize. I was at a trade show for my employer when a competitor walked up to our booth and out loud proposed that we should all fix our prices. We didn't of course, but the brazenness of saying something like that out in the open like was what surprised me.
The good thing about price collusion is that it's hard to coordinate. If even one competitor defects (and they have every advantage to, as they'll win big), then the cartel falls apart.
One of the big rules of commerce is that competing on price is generally a no-no for large markets. Usually, the powers that be would rather compete on a perceived value; that is how “informal price collusion” works.
Price/cost is the last thing you compete on unless you have a wholesale advantage, which nobody in this particular industry does (visa/mastercard set core rates)
Source: I’ve worked with higher ups in numerous commerce operations.
Commerce is actually even worse than many realize. Look up pepsi and walmart as a small example.
sounds like an org prisonner's dilemma
Exactly.
That assumes that
* it instantly brings them a ton of consumers * they have capacity to serve those customers
if they don't competitor can just keep higher price (especially if it is just small middleman fee most people might not care that much about)
And even if both of those are true worst possible case is them expanding to handle influx of customers and then competition following in few months, making their investment moot
That's true, but the thing about price fixing is that it basically guarantees these conditions.
The price is artificially high -> there's a ton of demand waiting to be unlocked by the "potential energy" gated behind the unnatural price
Capacity is easy to plan around; get too much and you can just raise the price again.
> This would be like, ridiculously illegal. It's also not practical;
Not if you pay a bit of dividends to jared or dtj
i just wonder why you think fees are high. seemingly the only thing that keeps fees low elsewhere in the world is regulations.
> what's to stop Stripe from raising fees even more?
There's a big amount of competitors for card processing. Just because they aren't well known within tech circles doesn't mean they don't exist.
But there are many competitors no? Adyen at least comes to mind.
Not good. Stripe makes restrictions that PayPal allows (cannabis adjacent, adult adjacent) that Stripe blocks. Many vendors will be negatively impacted by Stripes morality police and selective application of their policies.
In my experience, having worked at several large PSPs, it is Mastercard and Visa who are the morality police. Stripe are just enforcing the rules insisted on by them, and PayPal forgot about them 3 layoffs ago.
Then how do other processors go over the Visa and MC rails for these transaction types? How does Stripe allow some and then block others?
Simply put, Stripe doesn't want to deal with the risk associated with those transaction types.
Why do people think this? Since when do giant corporations care about morals?
As usual, everything is about money. You can be sure that part of the interest in a paypal acquisition is paypal's consumer wallet product which allows them to extend into lines of business that are currently constrained by Stripe's model.
There are many bank and bank-adjacent companies who contractually enforce morals standards. It doesn't matter if the underlying reason for the morality is profit maximization, the effect is the same.
You seem to care more about the aesthetics of the sentence than the meaning behind it. We know that a company is not a person. It doesn't have a consciousness. It doesn't have a singular morality to work with. It borrows the decision making of its employees and contractors. We know that the "morality" of a bank or credit card company is really just a layer of abstraction for a group of decisions it makes to avoid bad press/sentiment/oversight/regulation. But if you analyze why people have morality, it's not that different; there are LOTS of things people would do that they currently don't if there was no underlying consequence.
It's not about morals, it's about regulatory heat and risk. Cannabis in the US remains illegal on the federal level, and the chargeback rates on adult services are through the roof.
It's not only about morals.
No, chargeback rates are not the only reason banking companies like Mastercard are dubious about adult content. In 2021 they added contractual terms to ensure that adult content uses age verification, has the consent of the participants, and to remove illegal content before it is published at soon after it is reported.
But also, the financial industry has a history of discriminating against their customers based in moral reasons (or at minimum bowing to regulatory pressure which stemmed from upstream morality decisions).[1]
[1] https://www.vice.com/en/article/pa8xy9/is-the-doj-forcing-ba...
Or, because as you say it's money (I agree) the Stripe will put their "morals" in place - with the financial result they reduce risk, get less chargebacks and lower costs - then pass the savings on to the C-suite.
Morals, generously interpretation of the usage, was just to indicate that Stripe has a more narrow risk window.
Only an idiot would think it was about actual human-grade morals or ethics. Let alone that there were actual morality police.
Yes, hence the value of an acquisition that has found a way to service these lines of business very profitably.
The tone of your original comment suggests you believe they're going to take over and start shutting off morally unacceptable money printers.
It's pretty easy, you get hit with a surcharge on your other transaction volume if you allow something that V/MC don't want you to allow, and if you keep doing it you could get cut off which effectively makes you irrelevant to many of your customers.
As others have said, it's about perceived brand risk (V/MC allowed X terrible transaction to take place) and regulatory risk.
What I find weird about this is that JohnC has been saying for decades that large mergers are pretty bad for both companies. You spend 2,3 years in limbo, figuring out what in the world to do with the other large organization. When Stripe makes acquisitions it's historically been small companies, doing things Stripe isn't doing. It's the kind of situation where pc is unlikely to speak publicly here, but I sure would love to understand what the plan is, if just as a shareholder.
I typically use paypal for paying contractors, but try to "load balance" across a couple competitors because you never know when one of them will flag your account, nor for how long it will be flagged.
Consolidation in this industry puts my ability to transmit money at greater risk.
Paypal was worth near $50 when it IPO again in 2015, and it is still worth $50B today?
And this isn't some inflated market cap either, apart from 2021 and 2022 they have been making $5B+ Net income in the past 6 years. I would love to dive into how Paypal makes money because that is an order of magnitude bigger than I thought. There must be some market in which Paypal is popular and culturally accepted as by default payment.
Which also makes me want to rethink how much Apple Pay is worth if it was a separate business.
If I worked for PayPal right now I'd be printing résumés. Stripe recently laid off 300 of their IT people. To paraphrase Petey Greene, I wouldn't trust them to wash my car.
That would be quite a play. Stripe, PayPal, Venmo, Braintree, Xoom all under one umbrella. The Herfindahl-Hirschman Index (HHI) for online card-not-present (CNP) checkout on that is going to be absurdly high and this will take a lot of convincing to beat antitrust. They will probably have to unwind Venmo and Braintree.
Convince who? There is no such thing as antitrust anymore in the USA, it’s merely the size of the bribe required to let the merger go through now
States have the ability to sue to block mergers as well as the federal government. See the recent 11 state lawsuit seeking to block the WarnerMount merger.
Just a couple of months ago, someone was still suing[1] to block Alaska Air/Hawaiian. This is a merger that already entirely went through. I would predict equal likelihood of some state lawsuit derailing a merger like this.
[1] https://viewfromthewing.com/passengers-demand-court-undo-ala...
There's a pretty clear difference between a lawsuit by 8 individuals, vs one filed by attorneys general representing a combined ~100m people.
If it isn’t red states the current admin won’t care at all. If it’s mostly or entirely blue states, they’ll just default to siding with the merger out of spite.
Sure they have ability, they are just not doing it often enough
Which is funny because regardless of whether or not those states succeed in blocking the merger, those legacy video entertainment businesses will become irrelevant whether they are one business or two, due to the fierce competition from TikTok/Instagram/Reddit/Youtube/Whatsapp/computers/anything on the internet in general.
It's probably the most inconsequential merger, from a consumer standpoint.
Do you have any evidence that you can just bribe your way past antitrust regulations (which are enforced by hundreds or maybe even thousands of attorneys across the political spectrum) or is this just how you feel because you don't like who is in the White House right now?
Not anti-trust, but you can apparently bribe the FCC to get a merger through. This just came out today.
https://www.propublica.org/article/paramount-mergers-fcc-ken...
I was curious so to get a very rough ballpark figure. So I went to the Wikipedia List of largest mergers and acquisitions article (https://en.wikipedia.org/wiki/List_of_largest_mergers_and_ac...)
Added up all the free market enterprise section completed deals where the purchaser was indicated as US based
Obama era:
2009: 6,
2010: 1,
2011: 4,
2012: 1,
2013: 4,
2014: 5,
2015: 7,
2016: 6
Trump term 1:
2017: 4,
2018: 8,
2019: 13,
2020: 7
Biden term:
2021: 4,
2022: 4,
2023: 7,
2024: 4
Trump term 2 so far:
2025: 11*,
2026: 9*
Obama average: 4.25 / year
Biden average: 4.75 / year
Trump term 1 average: 8 / year
*Most of the last two years are indicated as still pending, so not sure if they will go through or not.
Not exactly the most scientific data gathering or study. But it does suggest that large mergers and acquisitions have generally been made more frequently under Trump.
> Do you have any evidence that you can just bribe your way past antitrust regulations
Well... we certainly know that preemptive appeasement is a thing [1]. IMHO, this is equivalent to a bribe - a favor, just not in monetary form.
[1] https://www.theguardian.com/media/2025/sep/26/kimmel-controv...
You think they'd only have to go through antitrust in the US? These are global payment processors, and the EU loves getting involved in this kind of thing. And no they can't just ignore it if they want to keep the majority of their customers.
Quite true. Or honestly, it's really barely about direct financial bribery anymore[1] - all the recent ones have just hinged on incredibly naïve (and easily manipulable) readings of how a merger might affect culture war / red vs blue partisanship.
For instance, CNN really doesn't matter, and was a tiny part of WB/Discovery, but of course Trump cares deeply about (hating) CNN, so all that was needed to win over Trump and guarantee his approval was for the acquirer to whisper to him that they'd do a housecleaning there. This lifehack would work for acquiring any company that happens to control any media property that hasn't established itself as a Trump cheerleader.
Note: I'm not even a Democrat today, but the pure and petty corruption on display definitely sickens me.
[1] though, back when it was, the bribes were astoundingly high ROI due to how cheap they were!
If it's a card-not-present transaction, Visa or MasterCard is making the bulk of the commission and forcing the vendor to take on the risk of a transaction without a PIN or password.
At least the others offer the hope that maybe some customers will pay directly from a Stripe/PayPal account, without the high commission and high risk of a Visa/MasterCard network transaction.
>If it's a card-not-present transaction, Visa or MasterCard is making the bulk of the commission and forcing the vendor to take on the risk of a transaction without a PIN or password.
3DS2 is the solution to that problem.
Not true. Visa and Mastercard don't make the bulk of the commission. When a merchant pays a standard 2.9% + $0.30 fee on a credit card transaction the issuing bank gets roughly 1.5-2.5% for interchange, which is the bulk. The processor or acquirer gets anywhere from 0.2-0.5% and the card network gets only about 0.1-0.15.
Also, PayPal does not lower a vendor's commission. If they pay with a PayPal cash balance, PayPal still charges the merchant a premium flat rate (often 3.49%) and simply pockets the entire spread. They don't pass the savings down. And consumer's don't have a Stripe account to pay from, Stripe is probably aiming for PayPal wallets via this move.
Upvote because AFAIK this is true. Not sure why your comment was downvoted to dead just a few minutes ago.
Gosh, with such efficiency of operations consumers will win because pricing of their services will be more efficient! Todays Feds will try selling that story.
PayPal user for 20+ years and it is time to end that dross
Let me know where I can get PayPal's micropayment rates for the 80%+ of transactions (below US$12) that support ardour.org ...
We save almost US$0.25 per $1 transaction because of PayPal.
Nah, I hate them with a passion as a merchant but I absolutely love them as a buyer and customer.
There is a reason why after all these years and other solutions they're still everywhere, and it's not because of their great tooling, their low fees or their awesome support for merchant. It's not because of market lock in either, at least here in Europe they're merely a middle man between my credit card or sepa bank account and the merchant. It's because buyers trust it.
Buyers don't trust stripe. Stripe is for the merchant.
As a buyer I don't trust Paypal. They use dark patterns to try to get me to sign in, then make it hard to sign out, and for whatever reason my account is wedged and even though it has the correct payment details, the payments all fail. The UI is antiquated and the embedded version that has the animated progress bar GIF is sketchy at best. The Venmo app (which Paypal owns) is jammed with crappy ads and an often-broken UI.
The advantage that PayPal offers me as a buyer is a middleman between the vendor and myself that I control. The vendor does not get any of my card or bank info, and if it’s a subscription I can easily cancel it at any time on the PayPal side without having to go through whatever dark patterns the vendor might have to prevent you unsubscribing.
Nah I thought I liked PayPal as a customer until I found out that they favor large merchants against the consumer. I had a problem with a product and the company was playing games with the warranty. I only had it for 3 months and it was already falling apart. I made a complaint with PP and it was auto denied.
I will never use PP for a large purchase again.
I don't know about recently, but for many years paypal automatically sided with the customer.
We had many customers that would buy a 1 month sub then chargeback the whole amount after using it heavily for a few days, with a nonsense reason like "item not as described" or "unauthorized charge".
Yep I had a case where I bought something online and it was not as described. The merchant didn't respond to emails, I filed the PayPal chargeback and the case was taking ages as the merchant wasn't responding. They finally responded on the last day to basically say I got my item. Despite all my evidence I provided it didn't seem to matter. So I again would have to respond and now wait for PayPal to rule. I was getting so sick of it, I just filed a chargeback with my credit card company instead and they gave me the money back right away upfront and did their own investigation after the fact and ruled in my favour.
I have had PayPal work for me for refunds many years ago, but the problem is often how long the whole process takes and how long your money is held hostage. By the time you maybe get your money back, you've already had to pay off that money on your credit card (if you used credit for the PP transaction). I've found that when I do a chargeback via my credit card, they often give me the money back right away and then do an investigation. If it were to not go my way the money would get taken back. I think this feels more fair depending on the case. Some cases are pretty clear cut and there is no reason to hold your money hostage while they confirm what you said is truthful.
Paypal isn't the right place for warranty disputes. They're not in the wrong there.
If you want purchase protection you need to use a card that offers it.
A product advertised as having a 1 year warranty and then the seller not honoring the warranty is the product not being sold as described.
But yes, it's my mistake for assuming the purchase protection would... protect my purchase.
And now I won't make that mistake again. The value isn't there, neither with their aggregation service nor their credit product.
I can just use Google Pay with a credit card, both of which are more convenient and offer better protection than PayPal does respectively.
As a buyer, I like something that's good for the merchant, because 99% of the time I'm buying from merchants who I trust way more than I trust the other buyers. Don't even want credit card middlemen if I have the choice.
Yeah, any subscription I can push through PayPal, I do so, because I can cancel it directly on their end. I don't need to go through a ten click justification process with the merchant.
> ... because buyers trust it.
I did until October 2022, when PayPal published an update to its Acceptable Use Policy that threatened to fine users $2,500 for promoting "misinformation".
Like they were the arbiters of what is misinformation and worthy of economic penalty. While it was later rescinded, it was beyond the pale. It's proof that something is corrupt and completely out to lunch in their management, and I won't sign up again after deleting my account in protest.
Edit: So apparently they only removed the misinformation clause, and they may still seize $2,500 of your money if they alone decide you are guilty of "...the promotion of hate, violence, racial or other forms of intolerance that is discriminatory or the financial exploitation of a crime...". People are worried about authoritarianism, yet meekly cede such powers to a corporation? It boggles the mind.
> People are worried about authoritarianism, yet meekly cede such powers to a corporation? It boggles the mind.
The libertarian answer is that corporations cannot threaten your freedom because you always have a choice of whether to deal with them or not.
The libertarian answer is also mostly bullshit, but there is a kernel of a seed of a nugget of truth in there somehow.
I don't trust either one.
And as a consumer, I especially hate PayPal because they always try to screw me with their currency conversion rates by hiding the toggle button (and it happens that I sometimes forget to toggle over to my bank's currency conversion)
And only once have I ever won a payment dispute there (and that was as a merchant, not a buyer... lol)
Sadly still chained to it for Discogs...
Trying to create a monopoly before the lack of antitrust enforcement window closes.
If there is a cartel it's at the Visa & Mastercard layer surely.
I can't wait for Europe to come up with an alternative for Visa & Mastercard.
European business pay a "hidden" tax to the US on everything, in the form of Visa & Mastercard commissions.
Which (a) the EU can and does regulate (b) the majority of the commission goes to the issuing bank.
I hate feeling as if I'm defending Visa or Mastercard, but if we're going to attack them, let's get our storytelling correct first.
I doubt Stripe is anywhere near the monopoly status.
Back when selling online tech courses was viable (pre-AI), about 30% of transactions in the US were from folks using PayPal on the platform I used. There's a huge of people who use PayPal, it's even more outside of the US.
It's the same argument why Google isn't never considered a monopoly to the online ads space. Because the whole ads industry is much larger.
Same thing with card payments. There are online card payments and in-store card payments and other kinds of payments. Stripe + Paypal volume is considered a fraction of it.
In the US, PayPal has nowhere near the adoption of other countries, for making payments directly between accounts, and Visa and Mastercard have enough regulatory capture to ensure it stays that way.
If there wasn't a regulation-ensured duopoly, everyone would be switching to RTP or FedNow which each charge 4.5¢ per transaction, without an additional commission.
>FedNow
There is no recourse if something goes wrong with FedNow, right? Like you get scammed, and the scammer just keeps the money. Seems like a pretty big difference (in theory anyway) to PayPal. Although I'm apparently not the right guy to ask, since I really don't see the use case for PayPal vs. credit card.
Regulation E applies to FedNow instant payments as it applies to payer recourse.
https://www.wolterskluwer.com/en/expert-insights/navigating-...
https://www.consumerfinance.gov/rules-policy/regulations/100...
What is the regulatory capture? Visa and master card have contract terms that ensure retail capture. That’s a private moat not regulation.
What’s stopping a new competitor to come in apart from regulations? You would expect someone already trying that given how profitable it is
The contracts with merchants prohibited them from accepting other forms of payment.
https://www.justice.gov/archives/opa/pr/justice-department-s...
With wechat in china, pix in south america and wero in europe, I think it's quite the opposite. All continents want to see visa and mastercard dead so they can bring back those transaction fees in house and it will work as the phone is the low friction payment method now.
Wero in the EU is fantastic, albeit still very young. Once it's mature and deployed everywhere, I see no reason to use something else in my country.
In fact, in France, the CB system endured despite visa and mastercard for 4 decades, so we know how to do it already.
No reason it can’t be broken apart in the future. States will likely file suit, as twelve already have regarding the Paramount Warner deal.
You mean that Paramount-Warner deal that people waited and let happen so they could break it up in the future?
The deal that a low regulatory executive administration is supporting, while states attempt to prevent it (acting in place of what one would expect from an appropriately functioning Dept of Justice and FTC) until regime change. Midterms are approaching, and this admin has a bit more than two years left. Some folks involved are either at, or beyond, human life expectancy as well. Sort of but not quite similar to Brexit, which barely eeked by, and now all of the old pensioners who supported it are dead after a decade and the country is ready to consider getting back into the EU.
TLDR This low regulatory period of the US political timeline will eventually end, and there will be a lookback/clawback period. Nothing is permanent. Rules can be changed at any time.
I'm not sure how this is a good thing. There are already very limited options to accept payments online, consolidating two of the major ones is not a great thing.
There are many options. If you make a lot of online payments, you'll see myriad payment processors.
Paypal is quite popular in Germany but with Wero that popularity will decrease significantly. I expect that all around the Europe.
Paying with Paypal is as easy as logging in. With Wero/iDeal you always need a phone or a code. People trust PayPal more too.
Wero has a for merchant/commerce part that integrates with PSPs. For instance Adyen: https://www.adyen.com/knowledge-hub/wero
But we aren't there yet.
I have not tried Wero, but I have tried the german predecessor (paydirekt/giropay). It was ... not much less smooth than PayPal.
But I’ve only ever seen a single vendor offering it. 0 for Wero so far.
In most countries, Wero is still in incubating stage. i.e., banks anouncing that in the next 3 years they will support it.
Of course it's not widely used by vendors when it's still in development. I am hopeful that it will take off to some degree in the nearest 5 years though.
I don't think vendors can offer Wero yet. I think it's part of the merger with other European companies.
That is what keeps confusing me when people hype wero. It essentially (I think some limited trials?) doesn't exist for B2C, and sending money to friends is a very minor use case.
So once it has really broad support and can be used as merchant, is when it'll maybe become interesting.
Well it's a nice thing to be able to send money across european countries only with a phone number even if it's only among consumers for now.
But it's been confirmed they are merging with companies that are already B2C in their own countries to bring a european B2C system
Wero is essentially iDeal. iDeal is great.
It is not. Wero has charge back support and therefor higher fees. There is quite some interest in Pay by Bank via PSD2 APIs. This is much more similar to iDeal and can work for the entire EU.
Great for merchants, not so much for consumers. Once the merchant has your money it's very difficult to get it back if things go wrong.
What is the alternative? I am not sure i can get my money back once they leave the card.
I like your optimism.
I don't know if popular is quite the right word. It certainly is widely used though...
In some ways, I would rather Stripe have the market power here to negotiate against Visa & Mastercard than Visa/Mastercard holding the reigns over a fragmented digital ecosystem.
Do the processing fees really add up? Can't fathom that Stripe is big enough to buy PayPal, but maybe I'm just 10 years behind on this industry.
Yes. People are prepared to pay Stripe 1% of all their revenue, same way they're prepared to pay card companies 2%.
Reading about Stripe’s stablecoin ambitions is funny. X uses Stripe, but Stripe on X doesn't accept my Bybit stablecoin cryptocard for a Pro subscription, ads, or boost purchases.
My worry is that fees might go through the roof without any other options
This would be amazing! Its such a pain having to set up two payment solutions as a merchant and as a buyer it would be great if I could use my paypal credit on whatever purchase I want. Consumers want paypal and merchant want stripe. I really want this to happen.
PayPal has been a payment option offered by Stripe for merchants for a while now. I don't know if there's more setting up than clicking the activation button.
Extremely weak bid, no?
PayPal was worth 5x this a few years ago... Even pre-pandemic it was worth far more. Hell, just a year ago it was valued at ~$80 share.
$60.50 per share would value them at just 11x their current earnings. I get PayPal isn't exactly a growth company anymore, but I'm not sure I understand why shareholders would agree to this offer?
Why, what is the play here? I know PayPal is used extensively in some countries (like Brazil?) but in most countries there are other/local services that have substantial market share and I do not think that PayPal can compete.
Don't forget Venmo - PayPal smartly gobbled that up many, many years ago, and it has a great amount of mindshare (though I don't know how profitable it is). Zelle popped up later and somehow has plenty of users, but unlike Venmo, Zelle is a steaming pile of sh*t of user experience, due to it being a consortium of all the famously-tech-backwards big banks, which stood it up out of fear and jealousy that those "Internet" guys might find a way to disintermediate them somehow.
Zelle was built to preempt FedNow. The banks saw what was coming and wanted to own instant payments.
https://www.frbservices.org/financial-services/fednow/about....
> Zelle popped up later and somehow has plenty of users,
At least for me, Zelle is something I can do in my bank app, so I don't need to work with anything I wasn't already using.
It feels a lot easier to use than Venmo, but I dunno. It's one of like 7 options I have to transfer in the bank app.
what's the problem with zelle? it works in my bank app, it's fast, no fees, it's really easy to use
If I'm buying something from a website and they don't offer Apple Pay, I'll opt for PayPal instead since I already have my credit/debit cards saved there and don't want to hand over numbers to a random website. Also, when I used to do more freelancing, all of my clients preferred to be invoiced and pay through PayPal (who skimmed a decent chunk of change off the top).
Not sure if either of those reasons would be what Stripe wants here, but just my two cents. I'm American fwiw.
Interesting that you'd mention Brazil. I consider it one of the very few examples of countries successfully replacing PayPal with a publicly owned service. Pix is ubiquitous in Brazil and has been for years. It has not only displaced PayPal but also cash and (in large parts) Visa/MasterCard, even in the face of US tariff threats.
It's actually pretty common for local payment systems to exist, it's not just Brazil. I've seen such systems in Europe, Asia, Africa and I'm sure they exist in other places I've never been to
Oh they exist all over the place. Pix is just unique in its success. It has only been around for ~5 years and it's completely taken over the country.
Consolidation (move toward making Stripe the only game in town).
PayPal seems to me like something from the past that no one uses. But sure, they have a market and a profit, but a future?
Will Stripe move customers from PayPal to Stripe or will they fix PayPal?
how things have changed! the grand daddy is being acquired!
PayPal owns Venmo, though.
Wow! TIL. Totally ignorant is I.
that’s great
Not great tbh.
The more time goes on, I'm starting to come around to paypal's original vision of decentralized internet-native money as being the future.
The more the international system breaks down and countries abuse their power via the banking system (especially the US, and from both parties), my opinion of cryptocurrencies transitions from "annoying scam infrastructure for hucksters" to "actually...you might have a point." Still a ton of growing up that needs to be done by the industry.
But no company or country should be able to tax the global economy via payments monopoly and you should not be able to be arbitrarily banned from the economy by these global supra-national intermediaries that have no court system and no democratic levers to pull to reign in their overreach in your country outside of desperate social media posts.
Stripe brags incessantly about how much of global GDP they facilitate...which, cool. I don't doubt there's an insane amount of work required to herd all those global cats and make payments just work. But, they're literally taxing the entire world as a % of GDP due to this dystopian legacy system? Is that the best outcome for humanity?
Everyone rushing to get these consolidations done before America starts having anti-trust law again, huh?
thrilled that stripe is buying paypal
I really do not grasp business when PayPal is somehow worth over $50 Billion
It doesn't have assets? It's not a bank
Is it because PayPal is integrated already into so many websites?
Wouldn't it take decades to make back $50 Billion in fees?
If you look at their financials, they’re clearly making money. In 2025 they had 33B in revenue with a net income of 5.2B
PayPal is sort of the Facebook of digital payments: they stopped being directly relevant years ago, but own many of the things that you or someone you know continue to use. Venmo being the obvious one, but also Braintree, Xoom, Honey, Bill Me Later, etc.
Doesn't PayPal confiscate your money if you forget to withdraw it in time?
It's a bank in Europe
According to Wikipedia they hold $80 billion in assets.
They also hold a lot of financial data of its users, which is certainly worth more than anything that could ever make sense to my pleb brain.
2 poo companies
So... I got banned from PayPal (with no explanation) and Stripe closed my account (with no recourse for 'crowdfunding' after linking to Ko-Fi).
Cool, awesome, that's gonna be a great monopolistic picture for those that get unbanked across the entire Internet.
I've been thru 3 or 4 'lifetime' bans with PayPal. Just ask to be reinstated during the next big shakeup (now) and they'll let you back in. They want your money. They want your business. The exact same things you couldn't sell 25 years ago, the things that got you banned, are now listed online without care. They literally forget.
I mean less competition is probably not good for anyone.
Except for Stripe and other payment gateway companies, of course
and their oligarch financiers
Paypal have historically been anti-Palestine [1] but recently have calmed themselves (though not yet undone their discriminatory practices).
Then Stripe have historically been pro-Palestine but recently Collison has taken part in Israeli propaganda [2].
Can't wait for these two evil companies to team up.
[1] https://paypal.7amleh.org/ [2] https://www.middleeasteye.net/live-blog/live-blog-update/cal...
AI "sez": "PayPal's valuation has declined significantly from its peak of approximately $360 billion in 2021"
haven't been following the drop because otherwise I thought that Paypal was more valuable than Stipe + Advent combined (which seems to have previously been the case) - and so I would have thought Paypal would have been buying the other companies and that this was some weird way to try to devalue a competitor by offering to buy them