KIMARIE SANTIAGO’S small business is the kind of operation U.S. banks and payments companies have been trying to lure online for years. The COVID-19 pandemic finally made it happen. Santiago’s Saltopia, which sells infused sea salts with names like “Mustard Been Love” and “Ben There D’Onion That,” spent nine years selling almost exclusively to specialty stores and food distributors. When those businesses shut as stay-at-home orders spread, Santiago wasted no time making the shift. “Grocery chains, specialty shops, it just died -- our wholesale business died,” Santiago said in an interview. “I was like, This is our time. We have to focus all our business right now on direct-to-consumer and figure out how to drive as much sales and traffic to our website.” As millions of business owners like Santiago make the same calculation, payment companies that process online transactions are seeing a boom. PayPal Holdings Inc. posted a surge of as much as 30 percent in the number of newly active customers in core markets who use the service four times or more in 10 days, the San Jose, California-based company said. “People are jumping in with both feet, and not just dipping their toes in the water,” PayPal chief executive officer Dan Schulman said in an interview. “It’s not hyperbole that we’ve seen a three- to five- year acceleration. That’s the math.” At Global Payments Inc., revenue from processing online payments surged to 25 percent of the firm’s total as more merchants started to let customers make purchases online, the company said Monday. “That was always our plan, but that was our plan two years down the road,” CEO Jeff Sloan said in an interview. “It’s really brought ahead a few years of growth in the business.” Visa Inc. has seen online spending excluding travel increase by 25 percent from a year earlier every week since mid-April, twice the growth it was generating before the pandemic. In-store spending, meanwhile, cratered 50 percent in early April, Visa said. It improved in recent months as cities around the world started to reopen, but still posted a decline in the high single digits by late June. For banks and payment companies, the widespread shift to online shopping is an opportunity to help counter a decline in overall spending on credit and debit cards. (SD-Agencies) |