PayPal acquires Honey's shopping reward site for $ 4 billion

The acquisition comes as PayPal ( PYPL ) faces increased competition from technology companies such as Apple ( AAPL ) [19659004] Google ( GOOG ) and Facebook ( FB ) now offering either their own payment methods or payment processing. PayPal is also battling for strong credit card networks such as Visa ( V ) and Mastercard ( MA ) expanding their online payment offers.

Honey Science Corporation operates both as a browser add-on and a mobile app, offering consumers discount codes to approximately 30,000 online stores.

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It is a competitor to sites like RetailMeNot that collects promo codes and collects them for consumers. Honey stands out by automatically entering all eligible promotional codes for buyers under checkout and using the code with the biggest discount.

The discount website has a mobile shopping assistant, tracking tools and alerts, pricing history information, special offers and a rewards program.

PayPal, which also owns Venmo, has more than 275 million active consumer accounts and 24 million merchant accounts.

Honey was founded in 2012 and is headquartered in Los Angeles. It has 17 million active users each month, according to the release. Many of the users tend to be younger and overlap with Venmo's user base, according to a PayPal interview Wednesday with analysts.

Honey has raised more than $ 30 million from investors, according to Crunchbase.

The acquisition still needs government approval, but the companies expect it to close in the first quarter of 2020.

Once completed, Honey will retain its headquarters in Los Angeles. Its co-founders will continue to lead the Honey team.

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