Brief:

• PayPal, the payments company whose Q3 2017 sales grew 21% to $3.2 billion from a year earlier, now lets U.S. users send money to each other via Facebook Messenger, TechCrunch reported. More than 2.5 million people have linked their PayPal account with Messenger, the mobile payment company said.
• PayPal also introduced its first chatbot on Messenger to handle customer service questions and requests for help. The automated system uses the natural language processing capabilities in Messenger's platform to understand what people are saying, and those who can't get an answer from the bot can connect with a live customer service team.
• This comes as an alternative payment system to the one that's existed inside Messenger for several years. Now, users can choose PayPal as their default funding source for peer-to-peer payments through the messaging tool, which will likely shift some of PayPal's $80 million payment volume, per TechCrunch. The feature is available online and on iOS, with plans to soon hit Android.

Insight:

PayPal and Facebook's relationship has grown since the companies last year began to let U.S. customers shop from online merchants using Messenger chatbots, then making a payment with PayPal. The arrangement also lets customers link a PayPal account with Messenger in order to receive notifications and updates inside the chat app.

Merging the two mobile tools simplifies transactions in one streamlined app instead of making users switch to the native PayPal app. Becaues of the ease it provides, the new feature will likely appeal to many users among Facebook's large audience who use the platform to buy and sell goods locally. Meanwhile, PayPal's service is already integrated into Apple's iMessage, and can be launched through the Siri voice-activated digital assistant.

PayPal's new chatbot also shows how new tech capabilities can handle more complex requests from users aside from simple notifications. While live customer service reps can be called in, the chatbot will likely remove friction for some users who have simple questions, leading to a better overall experience.

PayPal eventually will roll out the service globally, which may take some time considering the massive user base of both companies: Messenger's 1.3 billion and PayPal's 218 million active users.