EBay has announced that it is ending its relationship with PayPal and will instead use Adyen as its primary payments provider.
PayPal's share price fell more than 11% in after-hours trading following the announcement. EBay acquired PayPal for US$1.5 billion in 2002 and then spun off PayPal in 2015 for close to US$50 billion. It is now worth over US$100 billion.
EBay said the benefits of the changes would be lower costs for sellers and more payment options for buyers.
The shift will start gradually in North America later this year and eBay expects most marketplace customers around the world to be using the new system in 2021.
PayPal spokeswoman Amanda Miller said the company will "continue to provide a comprehensive payments solution to eBay through July 2020." It will also remain a payment option at checkout for eBay customers until July 2023.
While PayPal's business with eBay is still growing - up 10% in Q4 2017 - eBay only accounts for 13% of payments processed, down from 16% in the same period a year earlier.
Based in Amsterdam, Adyen already serves more than 4,500 businesses, including 8 of the 10 largest U.S. Internet companies. In 2016, Adyen increased transaction volume 80% year-over-year, to $90 billion.
Subscription commerce booms in Australia as 86% report increases in revenue Posted on: 23-10-2018
The 2018 mCommerce Index released by Paypal Australia states that almost 90% of Australian businesses that adopted a subscription model experienced an increase in their revenue.Read More
New Payments Platform to Shake-up Invoicing and Payroll in Australia Posted on: 15-10-2018
“We’re working with the tax office and organisations like MYOB to think about developing standards for different sorts of payments, for superannuation payments, for payroll and particularly for Single Touch Payroll.Read More
comScore Study: PayPal Checkout Converts 82% Higher Than Others Posted on: 01-05-2018
A comScore study of large merchants found that PayPal Checkout converts at 88.7% - 82% higher than all payment types combined and 60% higher than other digital wallets.Read More