JAKARTA -The UK bank, Barclays, announces the establishment of a partnership with PayPal’s digital payments company. Barclays said the partnership of the two companies will combine their services to customers.
Through this partnership, Barclays customers in the United States and United Kingdom can use their PayPal account on Barclays-based mobile and online platforms. Meanwhile, Barclays products will also be enabled in PayPal account.
“By working together, we can facilitate customers in managing finances and payments,” said Barclays UK President Director Ashok Vaswani in the official statement, as quoted by Reuters on Thursday (26/4/2018).
The move comes as concerns from banking industry executive officials that major technology companies, such as Amazon and Apple in the US and Alibaba in China, sooner or later can dominate the global payments industry worth $ 1.8 trillion.
According to consulting firm McKinsey, with its growing customer base and platform, technology companies are expected to be present as a new face of the financial industry that could potentially sweep 34% of banking revenue.
The announcement from Barclays shows a major step taken by traditional lending companies, which are collaborating with major technology companies instead of competing.
Barclays and PayPal affirm, they are still talking more about how companies combine their services.
In addition, based on media reports last month, in the US is also rife financial companies that explore partnerships with technology companies. Amazon and JPMorgan Chase are discussing for collaboration in joint account checks. Similarly, Berkshire Hathaway, is considering collaborating with technology companies for health and insurance payments.
The technology companies are still facing major obstacles to entering the financial sector. Because the financial and payment activities have strict rules and customers still trust banks more than technology companies to keep their finances.
The announcement was also issued as Barclays prepares for the release of its quarterly earnings report on Thursday. The focus of the investors is that UK banking can increase their profits compared to other competitors in the US.