PayPal CEO says company has been talking with Amazon about “how to use one another's assets to the mutual benefit of our customers”
Context & Ripple Effects
PayPal enters these talks from a position of deliberate openness: it had already extended Venmo to PayPal merchants and, months after this report, tied its wallet into Android Pay. The pattern is a company converting a closed checkout button into a distribution layer that other platforms can plug into.
Amazon sits on the other side of the table with its own ambitions — by 2018 Bloomberg reported it was passing credit-card fee discounts to retailers that adopt Amazon Pay. Two companies building competing checkout rails exploring 'mutual' asset use is why this matters: the default outcome would have been head-on competition.
First-order effects
- PayPal stands to gain placement for its wallet inside Amazon's checkout flow — the largest US e-commerce destination it does not currently power — while Amazon gets access to PayPal's user base and off-Amazon merchant network.
Second-order effects
- Card networks and smaller wallet providers face a two-front squeeze if the two largest consumer platforms interoperate: interchange economics get renegotiated whenever Amazon or PayPal can route volume around them, as Amazon's later fee-discount offer to retailers already signaled.
Third-order effects
- If platform-to-platform asset sharing becomes the norm, payments consolidates around a handful of super-wallets whose reach spans marketplaces, devices, and peer-to-peer apps — with PayPal's crypto checkout move in 2021 showing the same strategy extended to new instruments.
The trend: E-commerce platforms are shifting from building proprietary checkout silos toward selectively interoperating their payment assets when scale advantages outweigh control.