"We've been talking about this phenomenon or trend for years now, and it's here," Rainey said on "Squawk Alley." "We experience it today."
There are factors responsible for the decaying presence of cash, Rainey said. The first is the digitization of payments. The second is the growth of mobile devices.
"It's where those two come together that really create opportunities like PayPal to really expand the suite of financial services, to large swaths of the population that are really underserved by how we characterize that today," Rainey said.
Rainey said the size of the "underserved" population is about 2 billion people globally who "don't have access to things that you and I take for granted, like a checking account or a savings account."
"The unique aspect of those 2 billion people is roughly 70% have a mobile device," Rainey said. "With that combination together, we can put all the power of a bank branch and all the financial services in the palm of their hand."
A 2018 study from the World Bank estimated the world's unbanked population to be 1.7 billion people.
Rainey's comments on the rise of mobile payments come one day after PayPal posted better-than-expected quarterly profit numbers. Its stock rose more than 7% on Thursday.
The value of payments completed through PayPal's platform grew by 25% to $178.67 billion, and it also saw an increase in the number of payments from its active users.
Rainey said PayPal, which owns the mobile payment app Venmo, has work to do increasing its presence outside of industrialized nations such as the United States, Canada, and the United Kingdom.
"We're less strong in some of these faster growth regions of the world like an India, like places in Latin America, certainly Africa," he said.
"And that's where really we can take our value proposition and the digitization of payments, and give those people access to financial services and importantly access to the online world that they cannot experience without some sort of financial instrument to pay online," Rainey said.
Earlier this month, PayPal backed out of its participation in Facebook's foray into cryptocurrency.
As Facebook attempts to launch its digital currency, libra, the social media giant has touted its potential benefits to people who are unbanked. CEO Mark Zuckerberg emphasized it in his congressional testimony Wednesday.
When asked about PayPal's decision, Rainey said the two companies are "very much aligned" in their mission to democratize finance. But PayPal wants to focus on its own priorities, he said.