What To Expect From Fintech Ad Networks

2024 is full of headlines with announcements of fintechs and banks entering the advertising business. Some of the big names such as JP Morgan Chase, Revolut, and PayPal have all started or have plans to start selling ads on their platforms

The advertising business has always been dominated by big tech companies such as Google, Facebook, Amazon, and TikTok. In 2023, the world’s ten largest digital advertisers—Google, Facebook, Amazon, TikTok, Tencent, Microsoft, Baidu, JD com, Apple, and LinkedIn—grossed over $492 billion. Brands and marketers worldwide have spent a whopping $3 trillion on digital ads in the past five years.

As we can see, advertising is one of the biggest business markets in the world, which makes it very attractive to fintech businesses. If fintechs previously focused on merchants within their network, now they are expanding beyond this limitation.

In my opinion, this move by fintechs and banks makes total sense as the world becomes more digital and integrated. Open banking and, moving forward, Open Finance technologies can further help these companies enrich their customer data, and generative AI makes customer experience and ads more targeted. Naturally, this opens more opportunities for fintechs and banks to further expand their business solutions, and I don’t think they will be willing to miss out on this opportunity.

Fintechs in the Ads Business

PayPal's Entry

PayPal is the latest fintech company to announce its launch of an advertising business for merchants on its platform.

In a press release issued in late May 2024, PayPal appointed Mark Grether as the Senior Vice-President and General Manager of a newly established division, PayPal Ads. This division will develop fresh ad formats, building on PayPal’s first ad product, Advanced Offers.

Grether has previously served as the Vice-President and General Manager of advertising for the ride-sharing app Uber, through which he grew advertising revenue to over $1 billion with more than 500,000 advertisers globally.

According to the company’s most recent quarterly earnings report, it processed 6.5 billion payments from 400 million customers. For the whole of 2023, it processed around 25 billion transactions.

PayPal’s new advertising business also implies the fintech giant sees value in retail media advertising. eMarketer suggests retail media ad spending will total $137.1 billion worldwide in 2024. Retail media has set a successful precedent for such ventures. It’s also a sign that payment companies are leaning more heavily into value-added services (such as advertising).