Digital Transactions Authoritative, insightful and timely information for payments professionals
Online-transaction processor PayPal Inc. processed 110.4 million transactions in the first quarter worth $6.23 billion, up 39% and 44% respectively over the year-ago period, according to figures released today by San Jose, Calif.-based eBay Inc., the company's parent. Of this transaction volume, some 71% came from auction activity, principally on eBay, a result that has varied little over the past year despite a strategic push by PayPal to process transactions for major Web-based retailers and other so-called off-eBay merchants. About 42% of eBay's gross merchandise volume relies on PayPal processing. PayPal continues to sign up accountholders at a sizzling pace, posting a 57% year-over-year increase in accounts to 71.6 million worldwide. Of these, some 22.1 million, or 31%, are considered active, meaning that they sent or received at least one payment during the quarter. The active count is up 52% from 2004's first quarter. PayPal accountholders include both buyers and sellers. For the quarter, PayPal's revenue rate per transaction came to 3.64%, up 7 basis points from year-end 2004 and 4 points from a year ago. Its expense rate was 1.15%, down fully 12 basis points from the previous quarter and 10 from the year-ago period. Losses, though modest, are generally taking a somewhat higher toll, reaching 0.30% of volume compared to 0.31% last quarter and 0.27% a year ago.
