PayPal partners with Skype for P2P payments in the Skype app

The integrated payment service lets people send money to each other while chatting on the Skype mobile app.
Written by Natalie Gagliordi, Contributor
(Image: Skype/PayPal)

Skype and PayPal are rolling out an integrated payment service that lets people send money to each other while chatting on the latest version of Skype mobile app.

The "Send Money" person-to-person payment feature relies on PayPal to handle the transfer, and users must link their Skype and PayPal accounts to initiate an exchange. The feature is for personal use only, meaning it's not designed as a way to pay for goods or services.

For PayPal, the integration is just the latest in a long series of partnerships aimed at expanding the company's ecosystem giving its mobile wallet more exposure for direct checkout. PayPal's Skype deal is nearly identical to one that it has with Slack, which allows Slack users to send and receive money without ever leaving the messaging app.

PayPal recently announced an expanded relationship with Apple that will make PayPal a payment option for App Store purchases. The payments giant also has deals with Visa and MasterCard, Citi, FIS, and Facebook, as well as tie-ins to Android Pay, Samsung Pay and Baidu.

PayPal's partnership motives also reflect an uptick in P2P payments. The company's social payments platform Venmo processed $8 billion in total payment volume over the second quarter, up 103 percent from the same period last year.

As for Skype, its parent company Microsoft has been working to expand the service beyond its traditional video-calling features. Microsoft rolled out an update to Skype in June that aimed to make the app appeal to the Messenger, WhatsApp, and Snapchat user base, but the redesign fell flat on Skype loyalists. Microsoft ended up issuing another update that restored core features including status display for contacts on the home screen, and the ability to share content from other apps within Skype chats.

PayPal and Skype said the Send Money feature will start rolling today to Skype users on iOS and Android, in the U.S. and elsewhere.

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