PayPal inks BNPL deal; Revolut promises to invest in UK

• What's at stake: Revolut is building a financial superapp and is seeking a broader U.K. license. 
• Forward look: Meta is pushing new payments tech for WhatsApp in India. 
• Expert quote: "This collaboration will empower financial leaders to make strategic decisions with unprecedented clarity," Nour Taher, co-founder and CEO of intella, which is working with Visa on Arabic language AI. 
  

PayPal has a new buyer for its Pay in 4 buy now/pay later loans. 
New York-based alternative asset manager Blue Owl Capital has agreed to buy approximately $7 billion worth of PayPal Pay in 4 BNPL loans originated in the U.S. over the next year. PayPal will continue to originate and service the loans. 

"This is another great step forward for PayPal and in line with our balance-sheet-light model for credit," said Jamie Miller, PayPal's chief financial and operating officer, in a statement. "This transaction reflects our disciplined approach to capital allocation. Partnering with Blue Owl helps support the growth of our Pay Later portfolio and gives us greater ability to invest in our strategic initiatives and innovation."

Pay in 4 was launched in 2020 and allows customers to break up purchases into four interest-free payments over six weeks. PayPal processed more than $33 billion in BNPL payment volume in 2024, an increase of 21% year over year. 

Asset managers and investment firms have been pining for short-duration BNPL loans. Swedish BNPL provider Klarna has an agreement with Nelnet to sell up to $26 billion in BNPL loans to the U.S.-based investment firm. Affirm also has multiple forward flow deals with asset managers and investment firms, including PGIM, Sixth Street and Liberty Mutual Investments. 

PayPal has a similar loan purchase agreement with investment firm KKR to purchase up to 40 billion euros of PayPal's European BNPL loans. It entered into this agreement in 2023, according to Keefe Bruyette and Woods analyst Sanjay Sakhrani. 

"We believe this decision benefits PayPal strategically since it allows the company to free up capital, but we expect the impact to be minimal in the near-term as the actual outstanding receivables for Pay-in-4 loans in the US are likely a fraction of the $7 billion agreement," Sakhrani said. —Joey Pizzolato 

Beata Zawrzel

Revolut ups UK investments as it seeks a full banking license

The London-based fintech Revolut says it will invest about $4 billion in the U.K. over the next five years and hire 1,000 people while it seeks a full banking license in the country.

The company made the announcement as it opened new offices in London's Canary Wharf and expands its financial services menu in the U.K. and other markets as it attempts to build a financial super app.

Revolut recently collaborated with Ant to support remittance to China, added investment products in the U.K. and expanded lending in the U.S. Revolut's product launch comes as rivals PayPal and Block also rapidly add financial services features to their offerings.

Revolut has applied for a full banking license in the U.K,, which would allow the fintech to offer mortgages and hold larger deposits. Revolut received a banking license in 2024, but it was provisional and limited. The company additionally plans to invest about $13 billion globally over the next five years as part of a goal to reach 100 million consumers by 2027. —John Adams 

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Visa-owned Tink to provide Pay by Bank P2P payment services in Finland

Tink, an open banking fintech owned by Visa, has secured a deal to provide Vipps Mobile Pay with account-to-account, peer-to-peer payments in Finland. 

Vipps Mobile Pay is a Nordic-based mobile wallet with more than 12 million users in Denmark, Finland, Norway and Sweden and processes over one billion payments annually. 

"Account-based payments have a strong presence in the future of Vipps MobilePay in Finland," said Perttu Kröger, Vipps MobilePay's Finland country manager, in a statement. "With Tink's market-leading connectivity, we'll offer almost three million Finnish MobilePay users a secure way to make simple payments straight from their bank account." 

Visa acquired Tink in 2021 for $2.15 billion following a European law that mandated third-party payment companies have access to bank information. 

In the U.S., Visa has paused its open banking program after the Consumer Financial Protection Bureau said it would consider whether banks can charge fees for data accessed through open banking connections. —Joey Pizzolato

Bloomberg

Meta showcases new payment tech in India

WhatsApp has added QR code payments to its business app as it tries to add small-business clients in India.

Meta, which operates WhatsApp, demonstrated the updates at a technology summit in Mumbai, along with marketing technology and customer support. WhatsApp has also received regulatory permission to offer P2P payments in India. 

India is the world's largest WhatsApp market, with nearly 900 million users, according to the World Population Report. India is also one of the world's largest digital payments markets, where the country's UPI payments rail has created demand for mobile wallets and real-time transaction settlement.

WhatsApp has attracted financial services users, though it has also run into controversy, with U.S. regulators pressuring banks over unsupervised use of the communications app. —John Adams  

Adobe Stock

Investors warm to agentic AI protocols

A group of venture capitalists, including Primary Venture Partners, ParaFi Capital, Stripe, Coinbase Ventures, Solana Ventures, Samsung Next and Polygon Labs, have invested $19 million in Circuit & Chisel, a startup that is developing a protocol for agent-to-agent commerce.

Circuit & Chisel was founded by Louis Amira, who most recently was head of crypto and AI partnerships at Stripe; and David Noel-Romas, who was head of crypto engineering at Stripe.

The startup plans to release ATXP, which will support payments between AI agents.

The investment comes on the heels of Google's launch of its Agent Payments Protocol, which guides agentic commerce and supports multiple payment types, such as debit and credit card, stablecoins and bank transfers. Google developed its protocol with Adyen, Alipay, PayPal, Worldpay, American Express, Mastercard and other firms.

Agent-to-agent payments refers to transactions that use agentic AI to manage processing on both ends of the payment. Agentic AI enables tasks, such as payments, to be performed with little or no human intervention–relying mostly on AI.

Mastercard, Google and PayPal last week all made announcements that expanded their usage of agentic AI to improve shopping and payments ahead of the upcoming holiday shopping season.—John Adams  

Christopher Pike/Bloomberg

Visa works on tech for Arabic language AI

Visa has partnered with Arabic language technology firm intella to develop conversational artificial intelligence for use in the Middle East and North Africa.

As use of large language models increases in the global financial services industry to aid customer service, marketing and internal work, Visa and intella are attempting to solve the complexity posed by the linguistic diversity in the region. The firms hope to address what they call an "intelligence gap" in AI technology that does not accommodate dialects. This results in existing AI models using a random sample of customer calls to produce conversational responses. 

There are more than two dozen Arabic dialects that Visa and intella will distill by analyzing call data to inform compliance, AI agent performance and product development. Intella will also use the data to improve Ziila, its AI agent.

"This collaboration will empower financial leaders to make strategic decisions with unprecedented clarity, driving growth and innovation based on every customer conversation." Nour Taher, co-founder and CEO of intella, said in a release.—John Adams  

Bloomberg

Guavapay halts operations in the U.K.

Guavapay has temporarily suspended its operations in the United Kingdom as the payments company works to combat mounting fraud on its platform and get back in the good graces of the Financial Conduct Authority. 

Guavapay on Sept. 18 said it would stop accepting funds into its MyGuava App and MyGuava business platform until further notice. Customers will also not be able to create additional cards, but will be able to withdraw, transfer or spend funds. 

"During the early launch phase of its e-wallet in 2024, Guavapay Limited (UK) faced significant challenges with fraudulent activity, with a high volume of fraudulent funds being received through its accounts," Guavapay said in a Sept. 19 statement. 

"Separately, the rapid growth of the business led to certain regulatory thresholds being exceeded," according to the company. "While Guavapay has worked to stay within the required limits, the scale and speed of growth meant that thresholds were ultimately surpassed." 

Guavapay operates in Argentina, Brazil, Canada, New Zealand, Poland and the U.S., according to its website.  —Joey Pizzolato

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Nigerian remittance fintech nabs $2.25M seed investment

Nigerian remittance and credit building fintech Kredete secured $2.25 million in seed funding to expand its operations in Africa and launch new finance products. Blockchain Founders Fund led the round, with investment from Techstars and the Tezos Foundation, according to Kredete. 

Kredete uses blockchain and stablecoins for remittance payments, and has more than 300,000 users and has processed more than $100 million in transaction volumes. Customers also build their credit scores on the platform by sending money. 

The fintech will use the funds to expand its reach to all countries in Africa, where it currently operates in 20 countries. The company also plans to offer a stablecoin-backed credit card, auto loans and mortgage loans. —Joey Pizzolato