Paypal To Acquire Swift Financial To Help Strengthen Small Business Lending
The global payment processing company Paypal recently announced that they plan to acquire Swift Financial, a company which offers owners of small businesses working capital to grow their companies. The terms of this deal have not been disclosed to the public. However, it is known that with Paypal acquiring Swift Financial, they will have more tools in their arsenal to expand on their already growing Working Capital product.
Who Is Paypal?
Paypal is an American company that operates worldwide as an online payment processing system. It supports the transfer of money between account holders and serves as a way to make and receive payments for businesses electronically. Paypal is one of the world’s largest online payment processing companies and was established in 1998. They are used primarily as a payment processor for auction sites, online vendors and other commercial uses.
Bolster Paypal’s Working Capital Product
This new move for Paypal is supposed to help grow a part of their company which has seen a lot more competition over the last few years. They had first launched Working Capital for businesses back in the year 2013. Since they first launched it, other companies such as Kabbage and Square began to emerge offering their own credit lines similar to what Paypal offers to owners of small businesses.
Knowing the full extent of the competition, Paypal decided to gain control of Swift in order to add their their own underwriting abilities and be able to expand the amount of data they can access in order to figure out the creditworthiness of their customers. This, in turn, will grow the amount of capital they have available for their small business customers.
Paypal understands and knows the value of adding Swift to their arsenal. Their talent and technology platform will just further strengthen Paypal’s overall business and merchant value proposition. Combining Swift with Paypal will just further grow their existing relationship. It will also further enable Paypal the ability to serve their small business customers as well as enhance their underwriting capabilities in order to offer access to affordable financing solutions for more businesses than before to help them thrive and grow.
Swift Financial was originally founded in 2006. Since then, they have provided funding to over twenty-thousand small businesses. This is really great for a start-up and proves they are going to make a good fit with the already established Paypal. Combining both Swift with Paypal will easily give them massive distribution and the chance to reach more small businesses to work with and help.
During Paypal’s announcement about acquiring Swift, they had said they have already provided more than $3 billion dollars in funding to over 115,000 small businesses already since they launched their Working Capital product. The combining of Swift and Paypal is expected to be completed by the end of the year. Neither company plans to disclose any of the pricing or terms of the deal at this time. However, Paypal didn’t file an 8-K. This would have had to be filed if the transaction had a specific material amount. Additionally, it didn’t provide any changes in financial guidance. This shows that the transactions seems to be one that is of a non-material event.
Summary Of Paypal’s Acquisition Of Swift
•Paypal has began to acquire Swift Financial for an amount that is undisclosed.
•Swift is a company which offers online lending services to small businesses based on creditworthiness and other conditions that Swift deems important for decision-making.
•The deal for Paypal to acquire Swift Financial is being done in an effort to grow their already successful Working Capital Product in order to bolster a more strategic plan to bring in small business clients.