PayPal to acquire Simility, AI-based fraud specialist, for $120 mn
Digital payments giant Paypal has signed a deal to acquire Palo Alto-based fraud prevention solutions provider Simility for $120 million. It is an all cash deal. With Simility in its kitty, Paypal would be able to enhance its ability to deliver fraud prevention and risk management solutions to its merchants globally. The deal is expected to close in this year's third quarter. Here's more.
Paypal had eyes on Simility from long time, but why?
PayPal had its eyes on Simility for quite some time. It is one of the investors of Simility, and owns around 3% of the company. The reasons for Paypal's interest in the fraud prevention solutions provider are obvious, considering the growing fraud threat that e-commerce companies face. E-commerce fraud rate in the US shot up by over 30% last year (Y-o-Y basis).
What Simility has to say on the deal?
"We are excited to enter the next phase of our growth with PayPal and are thrilled to join them to help drive the next generation of payment and commerce solutions while scaling our business together," said Simility CEO Rahul Pangam.
What all will Simility bring on table for PayPal?
Simility, which uses a combination of machine learning and human analysis to detect and prevent fraud, will allow PayPal to offer its users features like fraudulent payment activity prevention, transaction verification, and risk management among others. It will also enable PayPal to put more control in the hands of its merchants to fight fraud while making their commerce experiences more secure.
PayPal is on a shopping spree; Simility its 2nd buy this week
PayPal is apparently on a shopping spree as Simility is its second buy in less than seven days. Earlier this week, PayPal had acquired global payout platform Hyperwallet for $400 million to enhance its payout capabilities and strengthen its presence among the e-commerce and online marketplaces. Also, earlier this year, PayPal had bought AI predictive retail start-up Jetlore and financial technology company iZettle.