PayPal recently migrated the horizontally scalable applications of its payment platform to Google Cloud—a significant shift in strategy to cloud-based transactions—to help ensure easy and reliable services for its customers.

Google Cloud results

  • Shifted the horizontally scalable applications of its payment platform and transaction workloads to the cloud
  • Completed a month’s worth of on-premises work in minutes in the cloud
  • Experienced significant cost savings over what it would cost to capacitize for peak volumes on-premises
  • Seamlessly handled the pandemic and holiday season transaction surges in 2020

PayPal was one of the first businesses to move money over the internet, securely and swiftly. Assisted by cloud computing, it wants to bring a better financial life to every possible point—and person—on the planet. With revenues reaching $2 trillion in 2020, the global payments industry is attracting a wide range of companies looking to win customers and expand markets by providing simpler and safer ways to make online transactions. Competing in this fast-changing landscape requires a global reach and high degree of efficiency. PayPal keeps its edge through an unwavering focus on agility and innovation. Today, PayPal has over 377 million active accounts in 200 global markets. Its customers transacted more than $936 billion in total payment volume (TPV) in 2020. The company has accomplished this through a strong technology-driven culture, running largely on its own infrastructure and third-party networks. In previous years, total payment volume (TPV) was growing at 25% annually. However, due to a significant uptick in digital commerce and user traffic triggered by the 2020 pandemic, PayPal accelerated its infrastructure strategy to support their customers’ evolving needs.

PayPal worked with Deloitte to define and execute a multiyear change in its infrastructure strategy, a bold move for a large-scale company intending to grow its global footprint in the middle of a pandemic. As part of its mission to move to zero data center ownership, PayPal collaborated with Deloitte to drive the exit of its non-strategic data centers. Moving its mission-critical workloads from primarily on-premises infrastructure to the cloud is a key enabler of this mission. This means by the end of 2021, PayPal expects to completely shut down one of its Salt Lake City data centers. While the process of adding capacity to an on-premises infrastructure typically takes months, with Google Cloud, PayPal was able to do three month’s worth of work in just hours. “With this shift, there was initially some concern among the PayPal team of engineers managing the workloads,” says Wes Hummel, Vice President, Site Reliability and Cloud Engineering at PayPal. “But once they saw how easy it was to add capacity through the highest peak holiday season we have ever had and reduce capacity when it was no longer needed, they were excited about the value of moving to the cloud.”

Deloitte provided assistance in migrating PayPal’s workloads onto Google Cloud by helping to define PayPal’s overall migration strategy and providing additional engineering support. Manual effort was minimized through the design, development, and implementation of automation scripts, reducing PayPal’s migration timeline. “Our multiyear journey with PayPal and Google Cloud originated from a shared interest in democratizing the future of financial services through the use of cloud technologies. Over the past several years, the Deloitte team has been proud to provide strategy and engineering talent to complement and augment the Google Cloud and PayPal teams. In 2020, our ambitious strategy paid off, as Google Cloud provided the necessary scale for PayPal products when consumers and merchants needed them the most,” said Dan Grayson, Cloud Engineering Principal at Deloitte.

Handles transaction surge quickly through a shift to the cloud

Previously, the PayPal team had ported its internally developed containerization platform to the cloud, which added performance to its microservices, without the need for new learning. Now the company needed to act quickly to manage the impending bursts in holiday transactions. The Salt Lake City region is Google Cloud’s sixth region in the United States and one of the 23 regions Google Cloud operated in 2020. It was chosen for proximity to many knowledge-intensive industries like healthcare, information technology, and financial services. Enterprises like PayPal that choose to run their platforms through Google Cloud regions can gain access to lower latency, enhanced scalability, and better end-user customer experiences. Customers can also take advantage of hybrid cloud solutions, or if they wish, split workloads across Western U.S. facilities in Los Angeles and Oregon, ensuring reliability at high speeds.

Speed matters for both operational efficiency and customer delight. Even a few hundred unnecessary milliseconds in processing a transaction can result in customer dissatisfaction. When the majority of operational activity is happening on Google Cloud’s secure, high-performing proprietary network, latency is minimized. After the move to Google Cloud, the PayPal team saw immediate improvements. During peak traffic times, like Black Friday and Cyber Monday, PayPal processed 1,000 payments per second. Google Cloud helped manage these high-traffic events by staggering workloads while also scaling up or down to manage off-peak times effectively.

Flexibly adjusts to infrastructure requirement ebbs and flows

When PayPal was handling transactions entirely on-premises and in its own data centers, it had to build onto its infrastructure to prepare for peak transaction load and maintain it at all times. With its payment platform now on Google Cloud, PayPal can quickly adjust to handle changes in traffic without the cost of continually maintaining that infrastructure. In fact, the company experienced significant savings during the 2020 holiday season by utilizing the Google Cloud.

With these changes, PayPal continues to democratize ecommerce as it scales, affording big-retail services to smaller, entrepreneurial retailers. By serving this market, PayPal can give consumers and retailers everywhere more choice, more opportunity, and more tools with which to improve their lives and businesses.

Envisions a Google Cloud future

Approximately 20% of PayPal’s core infrastructure is now on Google Cloud, with more to come. PayPal, in collaboration with Google Cloud and Deloitte, is continuing to implement a multiyear cloud transformation that will shift mission-critical workloads to the cloud, tap into cutting-edge advanced analytics capabilities, and increase its cost savings and resources.

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