PayPal Weighs Sale of Cross-Border Business Xoom

PayPal is reportedly mulling a sale for its cross-border payment unit Xoom.

The digital payments company has been working “on the sales process in recent months,” and has hired Goldman Sachs for assistance, The Information reported, citing unnamed sources.

An attempted sale could be a sign that Elliott Management, which purchased a stake in PayPal in 2022, is affecting the company’s strategy, according to the report.

PYMNTS has reached out to PayPal for comment but has not yet received a reply.

PayPal reported quarterly earnings last week that showed its peer-to-peer (P2P) total payments volume (TPV) — which includes PayPal, Venmo and Xoom — rose 2% to $91 billion and represented 26% of TPV. Cross-border TPV made up 13% of TPV, compared to 14% last year.

CEO Dan Schulman said during a conference call with investors that TPV from PayPal’s branded checkout “meaningfully accelerated” to 6.5% growth, while unbranded TPV rose 30% on a foreign exchange (FX)-neutral basis.

However, he cautioned that “even with this strong start, there remain many challenging issues to navigate. As we look forward, both the macroeconomic and geopolitical environments are complex and difficult to predict in these times.”

Earlier this year, Xoom teamed with Visa to let customers in the U.S. send money to eligible Visa debit cards in 25 countries.

PYMNTS research found that 16% of U.S. consumers send $76 billion each year in remittances. These consumers are seeking new options that allow them to do so inexpensively, easily, securely and conveniently.

The years-long evolution in how consumers move money abroad has opened the door to new possibilities for cross-border remittances, and people are now looking for cheaper options that let them transfer funds easily, securely and conveniently to other countries, according to “The Digital Currency Shift: The Cross-Border Remittances Report,” a collaboration between PYMNTS and Stellar Development Foundation.

Additional PYMNTS research showed P2P transfers on the rise, with the share of consumers who have made such transfers in the 30 days before being surveyed increasing from 27.5% in December 2021 to 34.5% in March.

The value of transfers increased over the same time frame, from $190 in late 2021 to nearly $300 in March 2022, hovering in the range of $234 on average in March 2023.