PayPal wants to cash in on opportunity to enable smartphone-based card payments for potentially millions of small businesses worldwide.
Swedish mobile payments platform iZettle has been acquired by PayPal in a deal worth $2.2bn.
The takeover comes just weeks after iZettle, creator of an ingenious card-reading device for smartphones, revealed its intention to list on the Stockholm stock exchange.
‘Small businesses are the engine of the global economy’
– DAN SCHULMAN
The acquisition, which is the largest in PayPal’s history, will potentially catapult the company into hundreds of thousands of bricks-and-mortar retailers around the world.
Once complete, PayPal will have an in-store presence in 11 markets in Europe and Latin America.
The deal also sets PayPal on a collision course with Twitter founder Jack Dorsey’s e-payments platform, Square, which offers a similar platform that lets small businesses accept card payments by plugging a card reader into their smartphones.
Helping small businesses succeed in a world of giants
Founded in 2010 in Stockholm by Jacob de Geer and Magnus Nilsson, iZettle provides a payment platform for small businesses.
Its revenue comes ‘per transaction’ with no added charges for companies. Stores are provided a mini chip card reader, with iOS apps and Apple Pay supported as well.
PayPal president and CEO, Dan Schulman, said that PayPal expects to close the deal in the third quarter of 2018. Once the acquisition closes, De Geer will continue to lead iZettle, reporting to PayPal COO Bill Ready.
“I’m pleased to announce that today we signed an agreement to acquire iZettle, the leading small business commerce platform in Europe and Latin America,” Schulman said.
“This is the largest acquisition in our company’s history and significantly expands our in-store presence around the world, strengthening our platform to help millions of small businesses around the world grow and thrive in an omnichannel retail environment.
“Small businesses are the engine of the global economy and they are increasingly demanding a partner that can provide a one-stop solution to help them compete and win online, in store and via mobile.
“The combination of PayPal and iZettle brings together iZettle’s in-store expertise, digital marketing strength and mobile point-of-sale technology with PayPal’s global scale, online and mobile payments leadership and trusted brand reputation, to support merchants and consumers in more ways,” Schulman said.