Almost every large American Internet company offers or plans to offer financial services. You are now pushing full force into Germany – what does that mean for the traditional banks?

The wallet in sight: Not only Apple boss Tim Cook wants to change the payment of the future.  Paypal is also increasingly coming to the European market with a breath of fresh air in its portfolio.

Dhe financial institutions here are getting more and more nervous. Almost not a month goes by without an American tech company announcing that it is entering markets that have long been reserved for traditional banks. Paypal has long been available at Shell petrol stations, for example. In June, Google announced that its in-house payment service, Google Pay, was launching in Germany. Shortly thereafter, Apple pulled the same and announced that its own payment solution Apple Pay goes on the market and should start according to reports this month. PayPal decided without further ado to also support Google Pay in order to penetrate stationary retail. And that’s not all: PayPal has now announced that they want to offer loans to small businesses as well. An older study by Bain & Company came to the result 5 years ago that fintechs and internet companies have already taken a 2 percent market share from banks – today the share is likely to have multiplied.

Paypal’s corporate loans are only the tip of the iceberg for the time being. They are mostly aimed at smaller dealers who need short-term bridging financing. In Germany it works very easily: If the retailer has had a business account for 3 months and has traceable sales, he can apply for up to 24,999 euros. After the check by PayPal, the retailer will find out within minutes whether he has received a loan. There is only a one-time fee and no interest. Every time sales are received on the PayPal account, a refund of 10 to 30 percent of the sales is automatically made. At least one repayment must be made every three months, which must not be higher than 10 percent of the total amount. In Europe, PayPal does business on its own account through the Luxembourg banking license it has held since 2007.