PayPal Holdings is increasingly relying on financial services, including credit and Buy Now, Pay Later (BNPL), to diversify growth beyond payments, with management expecting these revenues to grow at least twice as fast as the overall company in 2026. In the second quarter of 2026, financial services accounted for close to 20% of PayPal's transaction margin, while BNPL total payment volume grew 26% and monthly active accounts rose over 20%. Venmo Debit Card monthly active accounts grew more than 50%, and customers using both Venmo Debit and Pay with Venmo generated over nine times the average revenue per account of peer-to-peer-only users. However, consumer and merchant net charge-off rates increased to 4.8% and 7.6%, respectively, in the second quarter, and credit expansion raises liquidity requirements and external funding dependence. PayPal's shares have gained 37.6% in the past three months, and the Zacks Consensus Estimate for full-year 2026 EPS has been revised upward to $5.38, indicating a year-over-year increase of 1.32%.
PayPal Holdings IncFinancial services growth, including BNPL and Venmo Debit, drives revenue diversification and user engagement.
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