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Credit Unions Driven to Compete in P2P Space

PayPal's commanding presence in the P2P space is hard to compete with, so maybe joining them would be a better strategy for credit unions.

By Robert Broadwell | Updated on March 25, 2011

P2P is a hot commodity in today’s financial services industry and PayPal’s massive P2P network and instant recognition are leading the charge. Just like Facebook and its 500 million friends, PayPal’s 90 million users have massive clout in the payments world. More and more credit unions, which are looking for increasingly innovative ways to serve their members amidst stiff competition, will likely turn to PayPal’s powerful and proven brand to deploy payment solutions into their online and mobile banking platforms.

The primary reason for PayPal’s dominance of the P2P space: Integration with PayPal allows users to quickly send money to almost anyone with a mobile phone or email address. By leveraging PayPal’s global network to send money, the sender needs only to logon to online banking, enter the destination email address or mobile phone number, and transfer the money. If the recipient is one of the 90 million PayPal users, the funds will be deposited instantly for verified accounts. If the recipient does not have a PayPal account, prompts lead them to create one.

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