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PayPal Said to Be Mulling Stock-Trading Platform

Richard Hagen

SAN JOSE, Calif. – Internet payment giant, PayPal, is reportedly exploring ways to allow its millions of customers to trade individual stocks.

The market move was first reported by CNBC, and appears to be confirmed by the recently updated LinkedIn profile of Richard Hagen Jr., co-founder of the online brokerage TradeKing.

TradeKing has rebranded as Ally Invest after Ally Financial bought the digital wealth management company for $275 million in 2016. Hagen stayed on at Ally as president of brokerage and wealth management, but recently moved over to PayPal, where he is now the CEO of a new division, Invest at PayPal.

According to the Charleston, South Carolina, native’s Linkedin page, he is now “leading PayPal’s efforts to explore opportunities in the consumer investment business”

In February, PayPal CEO Dan Schulman signalled the expansion of the business in remarks to attendees at the company’s “business day” event.

Schulman suggested that in the future, financial services offered by PayPal would come in two forms — those created in partnership with existing financial institutions, and those created “organically.”

Regardless of which path PayPal took in developing these offerings, he assured his listeners “it will be a seamless PayPal experience across all of our financial services, which could include things like high yield savings accounts, direct deposit and check cashing, investment capabilities …. because if somebody is going to be putting their money onto our platform, we want them to be able to grow that money, to invest that money not just in things like cryptocurrency, but in individual stocks and other assets that we can digitize and allow people to invest in.”

In order to offer stock trading to customers, it’s possible PayPal will partner with or buy an existing broker-dealer as part of this plan. 

According to CNBC, one of its sources suggested PayPal has already held discussions with potential industry partners.

If PayPal did look to get full approval as a brokerage firm alone, it would need to complete a new membership process through the industry’s main regulator, FINRA. That process could take more than eight months. 

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