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Barclays and Paypal announce tie-up as banks mull big tech threat

  • Barclays customers in the U.S. and Britain will be able to use their PayPal accounts on the bank's online and mobile platforms while Barclays products will be used in PayPal accounts.
  • The move comes amid mounting concerns from bank industry executives that big technology companies could come to dominate the $1.8 trillion global payments industry.
Barclays Bank's UK headquarters in Canary Wharf, London.
Matt Crossick/PA Images via Getty Images
Barclays Bank's UK headquarters in Canary Wharf, London.

British bank Barclays and digital payments firm PayPal have announced a partnership that will see them explore ways to combine their services for customers, Barclays said on Thursday.

The pair aim to allow Barclays customers in the United States and Britain to use their PayPal accounts on the bank's online and mobile phone-based platforms while Barclays products will be used in PayPal accounts.

The move comes amid mounting concerns from bank industry executives that big technology companies such as Amazon and Apple in the U.S. or China's Alibaba could come to dominate the $1.8 trillion (£1.29 trillion) global payments industry.

With their ever-expanding customer bases and nimbler platforms, the tech companies could supplant the banks as the face of an industry that accounts for 34 percent of all banking revenues, according to consultancy McKinsey.