Robinhood faces new competition as PayPal explores ways to get into stock trading

on Aug 31, 2021
  • PayPal made an extreme impact on the crypto world when it announced the decision to offer crypto trading.
  • Now, the company is allegedly discussing the launch of a new service that will offer stock trading.
  • Nothing is official as of yet, but even if the firm does soon move towards this goal, it will not launch soon.

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Last year, when PayPal announced that it will finally enter the crypto industry by offering users to buy and sell digital currencies on its platform, the company seems to have realized that there is a whole world of services that it can add to its platform and improve its offering.

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Instead of simply allowing users to make payments to one another and to various services, PayPal is now seeking to enter the trading industry even more.

After taking its first step into crypto, the payments giant now aims to tackle traditional trading, as well. Recent reports revealed that PayPal is currently exploring potential ways of offering stock trading, which is why it is looking to team up with a broker-dealer, or even buy one, if possible.

A broker that can be acquired or partnered with will be crucial for the introduction of the company’s new trading service, and it will allow it to fully rival other crypto/stock trading platforms, and primarily Robinhood.

PayPal’s new stock trading service cannot arrive in 2021

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The reports regarding PayPal’s newest interest came from unnamed sources familiar with the matter, which revealed that the whole idea is still in the discussion phase. So far, the company has only talked about the prospect, and it mentioned certain industry players that might be involved in such a project once it starts.

However, it is highly unlikely that any such service will be launched in 2021. Not only due to the development part but also because gaining the necessary licenses and approvals from the FINRA is likely to take at least eight months, possibly more.

However, PayPal did hire Rich Hagen, the brokerage industry veteran, as the new CEO for a new, unknown division. All that is known about it is its working name — Invest At PayPal.

But, even if PayPal does soon announce plans to move into stock trading, that would not be particularly surprising, given its CEO’s vision of embracing as many more financial services as possible.