PayPal is recognized as world’s first online money transfer platform used by millions of people in more than 190 countries including Nigeria and other African countries (Cameroon, Ivory Coast and Zimbabwe etc).
The American company was first established in December 1998 as Confinity – a company that developed security software for handheld devices. PayPal co-founders are Max Levchin, Peter Thiel, Luke Nosek and Ken Howery who developed and launched the company as a money transfer service.
Before now, PayPal had shut Nigeria out of its services due to the nation’s notoriety for Internet-related frauds. But as fraud detection techniques improved and Nigeria became one of the largest economies in Africa, PayPal lifted its restrictions only to allow Nigerians transfer money to other users, but not allowed to use the service to receive or withdraw funds.
Functions of PayPal
Paypal is an online financial transaction company that allows users send or receive payments for online auctions on websites like eBay, purchase or sell goods and services, or donates money/receive donations. According to one of the company’s founders Thiel, the company is not a bank because it does not engage in fractional-reserve banking.
However, PayPal is subject to some of the rules and regulations governing the financial industry including Regulation E Consumer Protections and the USA PATRIOT Act.