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Lending Briefing: PayPal – one of the top 5 small business lenders in the US

  • PayPal says it's one of the top five small business lenders in the US, gaining ground in areas where traditional banks retreated.
  • Crypto lending is on the rise, with the industry's leading broker reporting over $50 billion in originations for Q4 2021.

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Lending Briefing: PayPal – one of the top 5 small business lenders in the US

PayPal was in the headlines quite a bit this past week, mostly thanks to news of its 4.5 million “illegitimately created” accounts, highlighting the banking/fintech industry’s fraud problem

John Rainey, PayPal’s CFO, gave this number to the public on the company’s fourth quarter earnings call, adding that the company “leaned into incentivized customer acquisition tactics to a much greater extent than we ever have in our history.” 

PayPal now wants to change its strategy from marketing campaigns offering a couple of bucks for a new account opening, which incentivized the fraud, and focus more on engagement and sustainable growth.

The issue of financial services fraud is systemic and not isolated to PayPal (stay tuned for an article dedicated to this later this week), but this is not what I want to focus on today. 

It’s another statement from a PayPal exec that caught my attention, one that generated less fuss in the media. Turns out that PayPal’s small business lending division is rising through the industry’s ranks, as the fintech now self proclaims to be one of the nation’s top five small business lenders, with the vast majority of business coming from areas deserted by banks.


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