The news: Square is moving into Spain with an early access program that lets merchants test its in-store and online solutions, per a press release.
Why it’s worth watching: Square emphasized global expansion in its Q2 shareholder letter, pointing out that its international markets achieved strong seller gross payments volume, which amounted to $42.8 billion in the period.
But Square isn’t the only payment provider going on an international expansion spree: PayPal brought its in-store payment solutions—specifically its QR code offering—to Germany through a partnership with Euronet and expects to roll out the solution to more EU markets. These moves bring the two rivals head-to-head as they both seek out growth opportunities on the international front.
Square’s opportunities: Evolving payment habits and retail sales growth in Spain offer substantial revenue potential for Square.
The bigger picture: As Square and PayPal look to build out their presence in Europe, they’ll need to contend with the European Payments Initiative (EPI)—a coalition of major European banks, credit institutions, and other payments firms.
EPI was established to create a domestic payment entity to take back control of European payment processes from US companies and poses a direct threat to PayPal and Square. Although the initiative is still in the beginning stages and unlikely to make an immediate impact on PayPal’s and Square’s European businesses, it might pose challenges for future expansion efforts on the continent.
Related content: To learn more about Square’s solutions and what makes it an attractive partner for merchants, check out Square’s segment in the Small-Business Payments Disruptors report.