PayPal will end its partnership with Alibaba after a year, according to company statements.
A document seen by Reuters suggests PayPal was “unhappy with AliExpress's rising consumer business on the platform, which is meant for business transactions, and wanted to raise transaction fees for certain accounts,” Reuters reported. No official reason was given for the break-up by the two companies.
“We have decided that PayPal will no longer be a payment option on AliExpress after August 3rd,” according to a statement from PayPal.
The decision came after a routine yearly review, the company adds.
PayPal reviews its programs and partnerships routinely to improve services to its users.
The company said it wanted to let users know about the change so they are prepared.
“We have valued the opportunity to work with AliExpress over the past year and wish them well,” Dickson Seow, director of communications, PayPal Asia Pacific, said in a blog post.
PayPal’s payment volume in the “Greater China” region was over $4.4 billion during 2010, which was a 44 percent jump from 2009.
“You’ll continue to see new initiatives, products and services from PayPal in China that help Chinese merchants grow their businesses by selling goods and services to our global buyers,” Seow said.
"PayPal remains deeply committed to China by providing Chinese merchants access to a safer and easier way to sell to millions of our users all over the world. And our business is strong," Seow adds.
Over 9 million merchants accept PayPal on their sites.
PayPal also has almost 100 million accounts in 190 markets, representing 25 currencies.
PayPal is EBay's online payment division, Reuters reports.
Alibaba.com is part of the Alibaba Group, which is about 40 percent owned by Yahoo, Reuters said. AliExpress is the wholesale website of Alibaba.com.
In other company news, Digital River, Inc., a provider of global e-commerce solutions, announced that PayPal is leveraging its Digital River World Payments solution to support local online payment processing in Brazil and Mexico, TechZone360 reported.
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