Income from share trading

PayPal is preparing to launch an equity trading platform, a continuation of its efforts to diversify and expand its business. PayPal already has a cryptocurrency trading option and is aiming to become a 'super app' for finance.

This suggests that PayPal is gearing up for its plans to "add equity investing capabilities" to its platform, as announced by company executives last month.

Details about the future new service from PayPal are scarce, with media sources saying that the stock trading service will launch first in the US and probably not before 2022.

Future new services cited included high-yield savings accounts, cheque-cashing services and equity investment opportunities. Last year PayPal launched the PayPal Cryptocurrency app in the US for buying, storing and selling cryptocurrencies, and it recently launched in the UK. It currently includes transactions in 4 cryptocurrencies: bitcoin, Ethereum, Litecoin and Bitcoin Cash. PayPal Cryptocurrency results show an increase in engagement and revenue per user.

At the same time, PayPal lags behind its competitor Square (SQ), which already offers both cryptocurrency and stock trading through the Square Cash app.

Stock trading on the app from Invest at PayPal could also make a significant contribution to the company's business, given the historic upturn in the stock market, which comes after a brief, sharp downturn last year.

Market experts point to the simplicity of the Robinhood app, the incredible growth in "meme stocks" (such as GameStop), cryptocurrencies and additional subsidies to the public in the US as key factors in why so many novice traders have entered the market.

JMP Securities estimates that more than 10 million new individual investors entered the market in the first half of this year, roughly the same as last year's record level.

According to CNBC, to offer equity trading to customers, PayPal may partner with or buy an existing broker-dealer. Sources say PayPal has already held talks with potential industry partners.

If PayPal has plans to obtain a brokerage firm licence, the company will need approval from FINRA, the industry's regulatory body. The process could take more than eight months.