Stripe and private equity firm Advent International have submitted an offer of $60.50 per share for PayPal, valuing the company at more than $53 billion, according to people familiar with the discussions.
The proposal, submitted earlier this month, includes about $50 billion in committed financing from banks and represents a roughly 28% premium to PayPal's closing share price on Tuesday.
The discussions remain confidential, and the sources said there is no certainty the approach will result in a transaction.
PayPal, Stripe and Advent declined to comment.
PayPal shares rose sharply following reports of the offer.
Under the proposal, Stripe and Advent would jointly own PayPal, each holding an equal stake rather than splitting up the company.
The combination would unite two of the most widely used payment platforms for internet merchants, creating one of the world's largest global online payments companies with about $3.7 trillion in annual payment volume.
Stripe's merchant-focused business would gain access to PayPal's more than 430 million consumer accounts, Venmo's peer-to-peer network and PayPal's consumer checkout services.
The combined business could also expand Stripe's digital wallet ambitions, increase transactions processed through its own network and support its efforts in stablecoin-based payments.
The proposal follows an initial approach made in early April, and the bidders are seeking to advance discussions in the coming weeks after not receiving a response from PayPal.
The offer comes as PayPal continues a broad turnaround under Chief Executive Enrique Lores, who took over in March.
The company has reorganized its business into three operating units covering checkout, consumer financial services including Venmo, and payments and crypto, alongside management changes aimed at improving growth.
PayPal has also outlined plans to streamline operations using artificial intelligence and expects initiatives to generate about $1.5 billion in savings over the next two to three years for reinvestment.
The proposed acquisition would add to a broader wave of mergers and acquisitions across the global payments sector as companies pursue greater scale and exposure to faster-growing areas of financial technology.
Analyst Andrew Jeffrey said, "We do not think PayPal's new CEO will likely embrace what could be viewed as a low-ball offer. If the current offer is an opening salvo, we could see Stripe and Advent go as high at $70 per share."