According to a financial report for the quarter, PayPal’s growth has slowed in various metrics in the fourth quarter of 2021. A major contributing factor was supply chain challenges.
Financial technology company PayPal has posted its financial results for Q4 2021, showing slowing growth after strong preceding quarters. Highlights of the report are total payment volume (TPV), which reached $1.25 trillion in 2021, a 23% increase in Q$TPV and 49 million net new active accounts.
Despite the slowdown in growth, PayPal reported strong performance in 2021. Last year’s numbers were better than 2020, which was itself a record year for the company.
Total revenue generated in 2021 was $25.4 billion, representing a 29% year-over-year increase. Active merchant accounts also grew 13% to 426 million.
With regard to its crypto services, PayPal touted its digital wallet as an early sign of success. PayPal released its digital wallet for crypto and other services last year, marking a 40% increase in crypto users for the first time. Another interesting fact, which could have implications for cryptocurrency adoption, is the fact that the PayPal digital wallet had 76% approval among 1,500 largest online retailers in North America and Europe.
Chief Financial Officer John Rainey said in the conference call that supply chain difficulties played a part in the slowdown,
“We had a slower-than-expected end of the year … a more muted end of the year for e-commerce growth, driven by both supply-chain challenges as well as a pull-back in spending by low-income consumers.”
PayPal’s Strongly Strong Crypto Services Could Foreshadow 2022 In 2021
PayPal has made a lot of progress with respect to its crypto services which were launched in 2021. Revenue grew steadily in 2021 as it expanded its crypto offerings. This allowed customers in the UK to buy and sell crypto even as the country was closing in on the crypto market.
Along with Visa and others, it invested in Blockchain Capital’s $300 million fund. PayPal’s CEO has said that the financial system will change more in five years than in the past 20, suggesting the company’s focus for the future.
PayPal will double its crypto services in 2022. More countries are allowing crypto to operate within limits, and PayPal would like to be the top platform for buying and trading crypto.