With news breaking Tuesday (Sept. 21) that Paypal is launching its much-anticipated new super-app, market watchers see this as a defining moment in the progression of both the fragmented app space and the rise of a connected economy encouraging ever more integrated models.
Talking up its super-app plans in recent months, Paypal President and CEO Dan Schulman told PYMNTS CEO Karen Webster in Q2 that “No consumer is going to have 40 or 50 apps on their phone,” adding that “there must be super apps that come together to consolidate all of your financial instruments. And by the way, those financial instruments include rewards points, and the ability to choose buy now, pay later, or even use QR codes.”
Making good on that statement, Schulman said in the announcement, “Our new app offers customers a simplified, secure and personalized experience that builds on our platform of trust and security and removes the complexity of having to manage multiple financial or shopping apps, remember different passwords and track loyalty rewards.”
What Schulman calls “simplified” is another way of saying super-integrated, as the super-app brings payments, loyalty, money transfers and even a new high-yield savings account supplied by Synchrony Bank into “a personalized dashboard of a customer’s PayPal account, a wallet tab to manage payment instruments and Direct Deposit, a finance tab that includes access to high yield savings and crypto capabilities, and a payments hub that includes send and receive money features, international remittances, charitable and non-profit giving, bill pay, and a two-way messaging feature to send notes of acknowledgment after peer-to-peer transactions.”
Leveraging Consumers’ Connected Preferences
With developments occurring in accelerated pandemic time for the past year and a half, super-apps plans are moving from concept to reality faster as the deluge of digital commerce drives customers and companies to rethink efficiencies while imagining new connected possibilities.
As Webster noted in June, “consumers like being connected, and most want to streamline multiple activities into a single digital channel for ease and convenience. Our insights provide a foundational understanding for every business interested in knowing how to adapt their strategies to take full advantage of this very digitally engaged consumer.”
Those insights come from PYMNTS’ ongoing ConnectedEconomy™ study series, with the latest installment finding consumers going deeper into connected experiences. It found that “Those highly connected at home, for example, are also highly connected in large shares in the realms of banking (91 percent), travel and leisure (92 percent) and health (84 percent). Majorities of connected workers are also highly connected in the travel and fun, banking and health pillars.”
Paypal’s new super-app covers much of this terrain. Per the announcement, “The new PayPal app will introduce a range of new shopping tools to enable customers to discover exclusive deals, make purchases and earn rewards seamlessly within the app.”
That includes discounts and offers “on hundreds of popular brands and will be able to shop through the in-app browser. Customers will be able to save deals to their wallet for future use when they checkout with PayPal in the app or online and use the in-app browser to search for coupons for even more ways to save when shopping with PayPal. The app will also include a new loyalty program, where customers can earn rewards redeemable for cash back and PayPal shopping credit on eligible purchases completed with PayPal.”
Also read: How Consumers Live In The Connected Economy
A Super-App Future is Certain, Though Not Entirely Clear
Paypal’s new super-app will likely speed up similar introductions by other payments players in the U.S. and Europe. Meanwhile in China — where the super-app concept arguably originated — regulators are taking a dim view of the data aggregation capabilities of apps in general.
PYMNTS reported that “In May, China’s regulator of cyberspace accused operators of 105 apps of illegally gathering and exploiting user data, according to WSJ. Companies were given three weeks to change their ways or face legal consequences. And just before that, operators of 117 apps were ordered to make changes.”
Brazil is another large financial market where super-apps and super-apps-as-a-service are catching on in a big way. Facebook-owned WhatsApp relaunched its payments service in May 2021 after Brazil’s Central Bank suspended that activity for nearly a year over app concerns.
In a recent conversation with PYMNTS, Brazilian FinTech Novae and Visa spoke of Novae’s new MilesBlue rewards program as part of a forming super-app-as-a-service ecosystem.
As for the seismic super-app news from Paypal, the company said, “In the coming quarters, PayPal plans to add new features and enhancements to the app, including investment capabilities and more ways to pay with the app online and in-store, including the ability to pay with QR codes in an offline environment and enhanced PayPal-branded capabilities that offer new ways to shop and save in-store.”