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Investing.com -- PayPal Holdings stock falls after several German banks blocked direct debits related to the payment platform due to suspicious or potentially fraudulent transactions, according to a report by Süddeutsche Zeitung.
Shares of the digital payments giant dropped as much as 3.4% in premarket trading following the news. According to the German newspaper, merchants using PayPal’s services are now waiting to receive payments that have been held up by the banking restrictions.
A PayPal spokesperson acknowledged the issue, telling Süddeutsche Zeitung that the company had experienced a "temporary service interruption" and was actively working with the affected banks to update accounts and resolve the situation.
The service disruption comes at a challenging time for PayPal, which has been working to maintain its position in the increasingly competitive digital payments landscape. The blocking of transactions by multiple banks could potentially impact user confidence in the platform’s reliability.
The company has not yet provided details on how widespread the issue is or how many merchants and customers might be affected by the transaction blocks.
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