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PayPal Becomes the First Payments Firm to Back Out of the Libra Association

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PayPal pulls out of Libra

PayPal has decided to withdraw from Facebook’s crypto project dubbed Libra. The renowned payments processor has made this move amidst mounting concerns of regulatory inspection from watchdogs across the globe. PayPal unveiled this news via an official statement shared with media houses.

In its statement, the company said,

PayPal has made the decision to forgo further participation in the Libra Association at this time and continue to focus on advancing our existing mission and business priorities as we strive to democratize access to financial services for underserved populations.

PayPal confirmed this decision by failing to send a representative to a recent meeting of the original members of the Libra Association. The other members met in Washington DC on October 3.

In response to PayPal’s withdrawal, the Libra Association noted that,

The type of change that will reconfigure the financial system to be tilted towards people, not the institutions serving them, will be hard. Commitment to that mission is more important to us than anything else. We’re better off knowing about this lack of commitment now, rather than later.

Libra’s Commitment to Serving the People

The head of policy and communication of the Libra Association, Dante Disparte said,

While some firms are backing out of the Libra Association, others are eager to share in the project’s mission. According to a report, Monex Group has applied to join the Libra Association. Per the firm’s president, Oki Matsumoto, the Libra project presents several possibilities. These include financial inclusion and cross-border sales.

This news comes after a report unveiled that four original backers of the Libra project sought to withdraw their support. These were PayPal, Visa, Mastercard, and Stripe. Per the report, these companies feared that their involvement with Libra could tarnish their reputation with watchdogs. While Stripe came out to refute these claims, Mastercard and Visa did not comment on the matter.

Prior to this, Facebook unveiled that it sought to have its COO, Sheryl Sandberg testify in the US on behalf of Libra. In so doing, the firm aims to have Sandberg clear concerns over the project.

Do you think Visa and Mastercard will follow PayPal’s lead and withdraw their support from the Libra project? Let us know in the comments below.

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