PayPal Chief Financial Officer John Rainey said the digital payments firm was never officially part of the Libra Association and although it was the first major brand to pull out, it did so only to focus on its own business strategies, CNBC reported on Thursday (Oct. 24).
In an interview with CNBC’s Squawk Alley, Rainey — a member of CNBC’s Global CFO Council — said PayPal only signed a non-binding letter of intent as an expression of interest in Libra.
“We share Facebook’s vision to democratize financial services for those that are underserved,” Rainey said. “Our decision to pull out and not go forward with Libra was made solely to focus on our priorities at PayPal.” He added that PayPal is focused on growth right now.
He said there are “two major secular trends that are taking place right now” — the digitalization of payments and the proliferation of mobile devices. It’s where those two come together that really creates opportunities for companies like PayPal to expand the suite of financial services to meet the needs of underserved populations, he said.
“There are some 2 billion people in the world who don’t have access to things we take for granted, like a checking or savings account. But 7o percent of those people have a mobile device,” he said.
“Our footprint today shows we’re strong in many of the industrialized countries like the U.K. but we are less strong in some of these faster growth regions like India and places in Latin America and Africa,” he said.
This is where PayPal’s value proposition comes into play, he said. The digitalization of payments can give the underserved access to financial services and “more importantly, access to the online world that they can’t experience today without some financial instrument.”
On Oct. 4, PayPal withdrew from Facebook’s Libra Association. PayPal’s statement at the time said that the company “has made the decision to forgo further participation in the Libra Association at this time and to continue to focus on advancing our existing mission and business priorities as we strive to democratize access to financial services for underserved populations.” The company added that it is “supportive of Libra’s aspirations” and said it will look to partner with the social media giant in the future.