PayPal is to buy payment management company TIO services for $233 million, the company announced yesterday. The Vancouver based processor has around 14 million users throughout 65,000 retail locations. It processed over $7bn in bill payments in the last year.
The move comes as PayPal is attempting to compete with the big league banks and offer greater financial services. TIO caters to those who are financially excluded and outside the banking system but who make regular utility payments with cash.
Speaking at The World Economic Forum earlier this year, Dan Schulman, president and CEO of PayPal stated: “We’ve got two billion people in the world right now that are undeserved: They need a basic system and platform for financial transactions.” It seems like Schulman is a man who keeps to his word.
“By acquiring TIO and integrating bill payment into our global payments platform, PayPal adds another key service in our efforts to become a part of a consumer’s everyday financial life.” says Schulman.
The strategic acquisition for the financial technology firm will give greater access to those who are unbanked. Customers can make payments online, on mobile phones and in self-serving kiosks in stores using cash.
“Worldwide, more than 2 billion people do not have affordable access to basic financial services, making it difficult and expensive for consumers to carry out basic financial tasks, including bill payment. TIO’s digital platform, and physical network of agent locations make paying bills simpler, faster, and more affordable.”
Hamed Shahbazi, Chairman and CEO of TIO, said: “We founded TIO to make speed and access part of the bill payment experience for the underserved, and we believe that we have created affordable products to serve the needs of all customers. Our mission fits perfectly with PayPal’s vision to democratize money. As part of the PayPal team, we believe we will accelerate our growth through expanded distribution and continue increasing access to more billers and services.”
A further £2.5m is expected to be raised from crowdfunding on Tuesday.
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