Payment Pricing

Payments are an interesting thing. Essentially payment processing, whether your financial institution, a non-financial firm like Block (Square), or a quasi-financial firm like PayPal are generally all commodity players. Today's Payments Dive has an interesting article as PayPal drives to find increasing pricing power under a new leadership team.

PayPal's Braintree subsidiary is an interesting case study. It is "unbranded" with PayPal but grows 30% a year while PayPal's branded segment only rose 6%.

I am a big fan of consumer driven repricing IF you have leverage and a story. I have led repricing efforts of late charges (in the private label credit card space) and subscription services (in the consumer recycling space). In both cases, we captured the incremental value we were providing for the customer with minimal actual breakage.

Will be interesting to see in a year how PayPal manages it.

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