Payment platform PayPal has launched its new Money Pools service, that’s been described as the equivalent of having an online “whip round”.
The idea behind PayPal Money Pools is that if something needs paying for collectively – amongst a group of friends or family members – for example, a Money Pool can be set up for everyone to pay into.
PayPal has said Money Pools can be set up to pay for almost anything in a secure way. Payments for special events and group gifts can be made via the service, as can payments for trips.
It is thought PayPal’s Money Pools service could prove very useful to small business owners. It could be used for planning and paying for work events, splitting the costs of gifts for co-workers and paying business travel costs, for example.
PayPal has claimed Money Pools cannot be considered the same as crowdfunding, since those that pay into a Money Pool don’t hold ownership over any service developed off the back of the finance raised.
In a blog post announcing the service, PayPal said: “Money Pools were created to provide the millions of people who already use PayPal P2P with a more personalised and organised way to share expenses for things like travel, gifts, celebrations and even recurring expenses like rent and utilities.”
Money Pools have this week been launched in 16 countries worldwide. As well as the UK, the service has also been launched in Australia, Austria, Belgium, Canada, Denmark, France, Germany, Italy, Netherlands, Norway, Poland, Spain, Sweden, Switzerland and the US.
Anyone in these countries who has a PayPal account will be able to create Money Pools, or be able to pay into one. Users must have a PayPal account in the first instance in order to chip into Money Pools.
Earlier this year, PayPal revealed the success of its Working Capital service at extending finance to small businesses. Since setting up the service in 2014, the company claimed in June that PayPal Working Capital has provided more than £400m to small firms.
In its latest announcement, PayPal added: “Unlike crowdfunding solutions, Money Pools are not intended to facilitate fundraising for activities such as product development, and organizers agree not to offer perks, rewards, or other incentives in return for contributions made to a PayPal Money Pool.”
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