Paypal Enables Small Business Cross-Border Trade
Most small businesses in developing countries transact only with local or regional buyers, in part because they don’t have inexpensive, safe, fast ways to send or receive long-distance payments. This can be a major challenge to growth—a study sponsored by eBay showed that merchants who earn at least 25% of their revenues through cross-border trade grow faster than those with less or no cross-border activity. Given that small businesses success earns eBay more income, the online marketplace is working to facilitate cross-border trade, in part by making electronic payments more accessible and convenient through its e-payments service Paypal.
Today, Paypal is available in 203 countries, and in 23 different currencies. It offers reduced fee programs to small businesses that quality, and it has partnerships with banks like First National Bank of South Africa and Interbank in Peru, both of which allow small business customers to easily move money between their bank and Paypal accounts to allow for more efficient and cheaper sending, receiving, and reconciling of international payments. The Interbank partnership has allowed businesses like Alpaca Expeditions, a Peruvian adventure tours company with an international clientele, to grow its business to include $500,000 in online transactions processed through Paypal.