International Finance: Recent Developments, MNE Key Elements, and Financial Performance of PayPal

International Finance

Contents
INTRODUCTION...........................................................................................................................................3
MAIN BODY.................................................................................................................................................3
Recent developments in international financial environment and impact on selected company...........3
Key elements of MNE..............................................................................................................................4
Financial performance.............................................................................................................................6
CONCLUSION.............................................................................................................................................13
REFERENCES..............................................................................................................................................15
APPENDIX..................................................................................................................................................17

INTRODUCTION
The study of organizations, practices and the assessment of bank lending that travel from
one jurisdiction to others are known as international finance. There are many notable differences
among international finance and its solely local equivalent, the most significant of which is
outflow of cash. Currency value risk is the probability that variations in the value of one national
currency per units of some other domestic currency introduce into any global financial
transaction. Additional variations also include climate for capital formation, additional risk
arising from political developments, and property and inheritance tax differentials (Di Pietro,
Marattin and Minetti, 2021). The study of the movements of currency values, foreign ownership,
and whether these influence world commerce is involved in international finance. To certain, the
term "international finance" may conjure up images of opulence and complication, yet its core
definition is anything but. Any cash institution that occurs across country boundaries is referred
to as international finance. The operation is classified as global banking whereas if confirmation
and receiving sites are located in 2 distinct nations.
The study would be based on PayPal Holdings, Inc., a digital financial company that has
innovated to function in the global market. The business is well throughout the board for its
worldwide internet banking procedures, which make money transfers easier online. PayPal is a
division of another technical company that provides solutions all over the globe.
MAIN BODY
Recent developments in international financial environment and impact on selected company
The circumstances for activities in the industry or financial global markets are referred to
as the world banking ecosystem. Anything substantial can have an impact such as the credit
quality of a government's economy. In this part, we'll go over some of the recent occurrences that
are expected to have an impact on PayPal's organizational effectiveness in the near future. The
following are the details:
PayPal could trade Crypto currencies using its platform: PayPal has added more
notches to its cap by allowing users to trade crypto currency on its platform. Customers are
allowed to purchase crypto currencies with their PayPal accounts. The company would make it

possible to buy crypto currency worth $20,000 per week, increase from the original cap of
$10,000. On the PayPal system, there are approximately 26 million businesses who accept bit
coins and other digital currencies. PayPal users would presumably gain from this type of system
when processing online transactions, the majority of which would be global. In the second
quarter of 2020-21, the corporation with 346 million users’ customer’s internationally collecting
fees worth $222 billion has the opportunity to expand its business operations (Zhang and et.al,
2021).
PayPal would not charge any extra fee to hold: The money earmarked for corona virus
alleviation is being laundered through the PayPal network. Official’s unearthed 700 cases of
money allocated for CARES Act and COVID-related assistance being redirected to major
websites like PayPal. This type of claim isn't helping PayPal operate its type of business, as any
unanticipated engagement would tarnish the company's reputation in a competitive environment.
The incentive for Social Security Assistance or the Salary Protection Program, worth $240
million, was discovered to be washed through such networks, according to Secret Service
officials.
Whenever criminal actions are carried out for a long time on the PayPal system, the
government will impose punishment. It would imply a blemish on the business organization and
impede its foreign operations. As a result, PayPal need a robust mechanism to prevent such
unlawful operations and to inform the authorities in the event of any questionable transactions.
That is because PayPal's suspected engagement in such illegal behavior might result in a large
punishment from the regulators, limiting the company's ability to expand into new areas such as
crypto currency trading, limiting its potential revenue (Hamidi, 2021).
Key elements of MNE
That is because PayPal's suspected participation in these fraudulent activities might result
in a hefty fine from the regulators, limiting the company's ability to expand into new areas such
as currency transactions, which would have a negative effect on the company prospects.
Sources of finance: PayPal gets its money from ordinary shares, government stock purchases,
and tax itemizing deductions, in addition to getting liabilities. In 2019, the company raised $3.7
billion to build its company's operations. The Modified Assess Quality was used to raise $5.5