Finance: What is PayPal?

What is PayPal? Wire us $20 to our PayPal account and we’ll tell you. Or just watch this video.

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Transcript

00:22

quickly and easily using a few folded bills in your

00:25

wallet Is gray paying for that stuff while in your

00:28

ninja turtle One z pajamas from the comfort of your

00:32

lazy boy violence Even better So yeah paypal is an

00:35

electronic payment system that takes paying for things online with

00:40

a credit card One step further It's still routes payments

00:44

through the user's bank But everything can be done with

00:47

the well it's Just the click of a button once

00:49

you've linked paypal to your bank account Well there's no

00:52

more typing in long strings of numbers digging a credit

00:55

card out of your back pocket to check the security

00:58

code and dates and all that on that business you

01:01

just say yes Thank you kindly I would liketo buy

01:05

these anti gravity boots via paypal And just like that

01:08

those boots are well on the way to your front

01:11

Door for better or worse you know provided they've been

01:14

weighted down enough space Well paypal was originally created to

01:18

help people pay for mostly ebay purchases specifically as well

01:23

as you know a few adult art films but as

01:26

of two thousand fifteen well ebay and hey pal have

01:29

been separate companies You know breakups are hard So these

01:33

days paypal is just well doing its own thing helping

01:36

people everywhere process their monetary transactions How sweet and philanthropic

01:41

of papal to do that right They do it all

01:43

for free Yeah No not at all They don't do

01:45

it all for free In fact they're pretty expensive Paypal

01:48

is in the business of making money there A publicly

01:50

traded company Well how did they do that Well two

01:53

ways Mainly First they collect a service feet on transaction

01:57

Almost the time As long as you're just a sending

02:00

twenty bucks it's a mom for her birthday or to

02:02

your buddy kin for your entry into the football pool

02:06

Well the transaction is free to you but a merchant

02:09

i eat Anyone selling a product pays a fee on

02:13

every transaction Generally that fee is anything ever take about

02:16

Thirty cents per transaction And then there's a small surcharge

02:20

In addition based on the percentage in the size of

02:23

the transaction right Well the other way papal makes money

02:27

is by earning interest on all that money sitting in

02:30

your account like it's just sitting there And then they

02:32

invest it and they make more in interest than you

02:35

do Just sitting with cash Right Five hundred fifty dollars

02:38

You've been socking away online for a rainy day Well

02:41

paypal has been making it rain because they invested in

02:44

Yes Maybe they only make two per cent of that

02:46

money and interest But there are a lot of people

02:49

let money sitting there Paypal account So with billions or

02:53

tens of billions or hundreds of billions of dollars making

02:56

two percent two papal with almost no costs associated with

03:00

that that's Pretty margin friendly kind of business right Add

03:04

it all up and pay pallor doing just all right

03:07

for themselves So yeah until the next great revolution in

03:10

quick and easy payment processing happens Paypal and other similar

03:14

sites like venmo and apple pay and maybe stripe Well

03:18

there are where it's at Still a little tricky to 00:03:21.005 --> [endTime] trade your animal pelts though for all that dollars