PayPal (NASDAQ:PYPL) recently announced the suspension of TIO Networks’ operations due to concerns about customer data security. TIO Networks is a cloud-based bill payments processor based in Canada that was recently acquired by PayPal. Its clients include major utility, wireless, and cable companies in North America.
PayPal decided to suspend TIO services after it discovered security vulnerabilities in the company’s platform. The suspension of the services was also due to the realization that TIO’s data security program fell short of PayPal’s data security standards. PayPal is currently reviewing TIO’s bill payment platforms as part of an investigation that has also seen the company retain the services of a third-party cybersecurity expert.
Further, PayPal acquired TIO for about $238 million in transactions completed in 3Q17.
In addition to its traditional business of supporting online payments, PayPal has expanded its offerings to include peer-to-peer money transfer and small business loans. PayPal has extended more than $3.0 billion in small business loans since the inception of credit services in 2013.
So far, PayPal has generated $841 million in free cash flow, indicating an increase of 36% year-over-year. This increase pushed up PayPal’s cash balance at the end of 3Q17 to a little over $4.9 billion compared with $4.1 billion at the end of the prior quarter.
Further, the improvement in cash balance further lifted PayPal’s asset base to $37.8 billion, up from $35.3 billion in the prior quarter.
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