The world of mobile pay or electronic payments has been exploding with growth in recent years. PayPal has been the leader in this space for the longest time and that has not changed. Year after year they continue to face growing competition, but they continue to grow and to lead the space. Will that continue?
Competition from many companies and technologies has been a threat to PayPal for years. Apple Pay, Google Pay, Android Pay and so many other new competitors are moving in and growing the mobile wallet or digital wallet space. Rather than taking PayPal market share, they tend to be expanding the marketplace. Today, there are more users and more companies in this space and that is only increasing.
Fintech competitors are expanding the space
New financial technology competitors are also moving in and competing from a different angle. So are assorted business-to-business and machine-to-machine competitors. These are all disruptive companies that are transforming and modernizing the entire money space, one slice at a time.
This is a rapidly growing, innovative space. That means every one of these companies and sectors are competitors to PayPal. However, rather than taking market share, the bottom line is as PayPal continues to hold onto their leadership position, the industry continues to expand. One reason: they were the first transformational competitor in the space for the last two decades and have learned more about being successful in this space than all other competitors to date.
Companies at biggest risk as fintech expands
Companies who are at the biggest risk are banks … the giant, old banks. They are having the hardest time transforming themselves from yesterday to tomorrow. The threat to banking comes from all the new competitors and innovation in the space and the fact younger customers have a trust problem with the traditional banking industry.
Banks are fighting an enormous battle against new technology and younger, smaller competitors. Banks have also shot themselves in the foot, time after time, shaking the trust of the next generation of customers. Think of all the scandals and problems we have seen from traditional banks like the recent Wells Fargo public relations disaster.
Youth look at banking industry very differently
This has shaken the trust the youth have in the banking industry. So, when some banks suffer, we should not feel bad for them since it was of their own making. There are plenty of good banks that have never taken advantage of customers.
The world is changing. We have seen major transformations in other industries that changed everything. Think about how the smartphone world has going through a complete transformation in the last decade.
The first Apple iPhone was announced 10 years ago. Apple’s iPhone and Google’s Android took over leadership and transformed the entire industry. Previous leaders like BlackBerry, Nokia and Motorola fell to the bottom of the list.
Same threat is changing the money space
The same threat has been changing the money space. The first major transformation was when PayPal launched two decades ago. That transformation and expansion continues with competitors in the mobile pay and fintech space.
PayPal continues to lead in this space, though I see other competitors continuing to grow in their individual slices of the pie. However, we should pull the camera back and see the historic changes that are shifting this entire industry. It is amazing.
The money space looks much different compared to a decade or two ago, and it will continue to change going forward. So, what will it look like 10 years from today? Who will be in the leadership position? That’s the question we all would like to know. Sorry, we’ll just have to watch going forward. However, this is a very exciting space, so stay tuned. The best is yet to come.
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