The need to facilitate the exchange of goods led to an evolution of money. Since years ago until now people exchange goods and services depending on their preferences. The evolution of money is a great historical process that deserves much attention and appreciation. It is through this process that modern people find it easy to transact in the world of commerce. Money started as commodity money to metallic then paper money and finally today we have electronic money. Cash is now gradually becoming useless as Fintech firms are dominating the world. This article discusses into details cash is becoming useless.
The digital money has enabled people to transact throughout the world at any time and place. Through fintech companies such as PayPal and Square, the provision of financial services and the transaction of money has greatly improved. We see that these fintech firms are greatly dominating as physical cash is slowly dying amid the pandemic. Different authorities discouraged the handling of cash because it is a viable source of the spread of the virus. therefore, the need for handling transactions and payment through electronic means.
Fintech firms (The PayPal)
PayPal is an American firm operating a global online payment system that encourages online money transfers. Moreover, its operations as an electronic substitute to customary paper ways like money orders.
Square is also an American financial services and mobile phone payment firm in California. The firm advertises payment products and has encroached towards small scale business services. Its founders are Jack Dorsey, also CEO of Twitter, and Jim McKelvey.
Current Stock Performance Of The Fintech Companies
Since most people are depending on these fintech companies for their transactions, their shares seem to have increased significantly. PayPal prices increased over 60% whereas Square has doubled its shares this year. Predictions show that these stocks may continue being high and thrive amid this coronavirus pandemic.
The analysis shows that there would be a significant increase in online shopping and digital transactions. This means that there would be a reduction of physical paper money. According to the Federal Reserve Bank of San Francisco, the use of paper money was already plunging before even the epidemic.
Earlier this week, Andrew Jeffrey increased his price aim on SQ to over $100 per share.
“Square is poised to take meaningful direct deposit share from banks. Pandemic stimulus highlights Cash App’s unique functionality, which we think can ultimately supplant customary checking accounts.”
PayPal and Square are the Hope for the Young Generations
Analysts say that SQ is today’s form of a local bank for Generation Y and Z. People are going for SQ neo-banking services.
Kenneth Hill, an analyst at Rosenblatt Securities, comments that:
“As SQ develops, and monetizes a slew of services across the financials ecosystems, it will lay the groundwork to make the company a need-to-own name for the future.”
Lisa Ellis, the MoffettNathanson analyst, says that despite the easing of restrictive measures demand for PayPal services maintains at the peak as months ago. Schulman ascertains that the company will increase by over 13 million new users in the 2nd quarter.
There is a conjecture that PayPal could provide the ability to trade the Bitcoin. Bitcoin trading has been a success in the case of Square. Its app income from bitcoin increased over 3 times from 2019 to over $300 million. It is obvious that PayPal would also desire a portion of the cryptocurrency sweet cake.