Report: Apple eyeing PayPal turf

Apple Inc. may be planning an entry into the fledging industry of mobile person-to-person payment.



According to the Wall Street Journal, Apple is in discussions with several banks to develop a service that would let consumers make mobile payments to each other, rather than use cash or personal checks. The service would be in direct competition with the Venmo mobile payment platform from PayPal, which is popular among millennial consumers.



Sources indicate Apple has been speaking with banks including J.P. Morgan Chase & Co., Capital One Financial Corp., Wells Fargo & Co. and U.S. Bancorp. Although the service would likely include Apple Pay functionality, there are still technical and financial details to be worked out.



Venmo currently represents 19% of mobile person-to-person payments in the U.S. PayPal reported a total of $2.1 billion of mobile person-to-person payments were made using Venmo in third quarter 2015, up significantly from $700 million the prior year quarter. This means the total mobile person-to-person payments market is currently around $10 billion, with at least PayPal’s share growing about 150% annually.



If Apple does enter this space, given its built-in user base and Apple Pay platform, it should be an immediate leading player. Whether it would take market share specifically away from PayPal or from the other 80% of the market, which includes big names like Square and Facebook, is a major question for PayPal.