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by fnordpiglet
13 days ago
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What I find interesting about this isn’t acquiring the flow from PayPal but the fact that PayPal has a bank charter and stripe doesn’t (not a real one, all that Georgia bank stuff is shenanigans). Properly structured this gives stripe a lot of interesting opportunities that they’ve had to delegate to partners and that dilutes not just their margins in the fee stack but restricts the types of transactions and merchants they can host, beyond the minimal regulatory constraint. The next move would be to offer a stripe managed card network that captures the full MDR interchange fee stack, from issuance to processing to network to bank. They could offer deep discounts to merchants hosting their accounts on their bank issuing cards through them and processing through them by cutting out every middle man. It would instantly become the third largest network in terms of points of sale behind visa and Mastercard. They could further carve out heavy rewards for customers through direct relationships with airlines, hotels, and merchants through their existing issuer services. They would become the first fully integrated vertical in payments, and the efficiency that would give them in fees would allow them to crush the hodge podge payment stacks out there that exist. I’d wager in five years they would dominate the market. |
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