PayPal Becomes First Foreign Company To Fully Own A Payments Platform In China

PayPal Holdings Inc (NASDAQ: PYPL) became the first foreign company to be in complete control of its payment platform in China, Reuters reported Thursday (Shanghai time). 

What Happened: The Elon Musk and Peter Thiel-founded fintech firm acquired the remaining 30% stake in China’s GoPay — formerly known as Guofubao Information Technology Co. — that it did not own as of Dec. 31, 2020, as per China’s National Enterprise Credit Information Publicity System.

A year earlier, PayPal had purchased 70% of the stake in GoPay for an undisclosed amount, according to Reuters.

Thereafter, the entity became the first foreign company licensed to operate as a payment services company in China.

No financial details of the latest transaction were disclosed.

Why It Matters: This latest development will pitch PayPal head-to-head against domestic heavyweights such as Alipay — owned by Alibaba Group Holding Ltd’s (NYSE: BABA) Ant Group, and WeChat Pay — owned by Tencent Holdings Ltd (OTC: TCEHY), noted Reuters.

Jack Ma-founded Alibaba is at the center of Beijing’s crusade against monopolies. The fall out of the antitrust drive may extend to others such as Tencent.

See Also: China Silences Domestic Media On Alibaba Probe: FT

The Chinese conglomerate also suffered a recent setback in the United States after Outgoing President Donald Trump banned transactions through its Alipay app.

Price Action: PayPal shares closed nearly 3% higher at $244.90 on Wednesday and gained 0.42% in the after-hours session.