PayPal has reached a major milestone: It’s been 10 years since the company rolled out its first mobile payments service—a service that gave users the ability to send money via text. And over the past decade, PayPal’s mobile payments volume has grown remarkably, from under $50 million at the outset, to a whopping $66 billion in 2015.
A PayPal blog written by Bill Ready, PayPal’s senior vice president of global product and engineering, includes a chart that demonstrates how rapidly the company’s mobile payments have spread in the U.S. since the initial mobile payments service made its debut in 2006. According to the chart, PayPal’s mobile payments volume hit the $1 billion mark in 2011 and reached $10 billion the following year. Of the 4.6 billion payments processed using PayPal last year, nearly one-third were initiated on a mobile device.
In the blog, Ready attributed the mobile payments explosion that has occurred over the past decade in large part to the release of Apple’s iPhone in 2007, followed by the advent of the App Store in 2008 and of Google Play in 2012. More recently, Ready wrote, the rise of “next-gen” mobile apps like Uber and Airbnb have altered the way consumers utilize their smartphones on the transportation and accommodations front.
PayPal has expanded its mobile footprint in keeping with the developments Ready cited. Case in point: In 2013, it acquired Braintree, a payment processor with a mobile focus. This move brought Venmo, the popular P2P money transfer service, into the PayPal fold. In January of 2015, Venmo processed a record $1 billion in payments, 250 percent more than in the comparable period in 2014.
But this is just the tip of the iceberg. PayPal has also added to its “stable” mobile payments service Paydiant, remittance provider Xoom, and contextual commerce specialist Modest. In addition, the company continues to move on its own in-house mobile initiatives. One example here is One Touch, which helps to speed up the checkout process for consumers who are making mobile purchases.
Ready noted in the blog that despite the rapid growth of mobile, it remains just a “tiny fraction” of all commerce. He believes there is ample potential for more mobile payments growth—especially in financially underserved markets. “Mobile is breaking down barriers and has the power to help drive financial inclusion globally,” he wrote. “Mobile will lead to more change in commerce over the next decade than we’ve seen in the last hundred years and PayPal will continue to lead this revolution.”
Whether PayPal will indeed lead the revolution, it’s too early to tell—although the company has more than a fighting chance at it. However, what we do know for certain is that there will be lot more to mobile payments in the short- and long terms than there is now. Industry players and merchants that refuse to acknowledge the change have a very short-sighted view, indeed.