NEW YORK (TheStreet) -- A partnership agreement between PayPal (PYPL) and Visa (V - Get Report)  was announced Thursday that allows Visa customers to move money instantly on PayPal, and PayPal won't steer customers to use bank accounts, CNBC's Kayla Tausche reported today on "Squawk Alley."

Visa CEO Howard Scharf commented on the partnership last night on a conference call to investors: "It's a long-term agreement, we feel that we've addressed everything that we wanted to address. PayPal, ourselves, and the issuers look at it and say it makes sense for all of us to work together," Scharf said.

Additionally, Gil Luria, head of technology research at Wedbush Securities, joined "Squawk Alley" this afternoon to provide further insight into the agreement, and to explain the stock's decline today.

"This is a phenomenal move for PayPal. However, the company didn't quantify the short-term dilution, and as we know uncertainty is worse than a bad outcome in the stock market and that's happening today. It opened up the door for people to assume the worst," Luria explained. 

Shares of PayPal are lower 7.27% to $37.21 during afternoon trading. 

"It's the most transformative thing to happen to PayPal since being on eBay (EBAY). This will allow PayPal to expand its addressable market by a factor of eight. I've also quantified the dilution at about 10 cents a share," Luria said.

Moreover, Luria believes that as good as the partnership is for PayPal, it will be equally as beneficial for consumers.

"This is truly metamorphic for PayPal. They're going to give consumers a much better experience, through choice, which means consumers are going to be a lot happier. It also gives PayPal a quantum leap in their ability to address a much bigger market," Luria noted.

Finally, Luria believes similar deals with other credit cards could be on the horizon.

"I would expect that to happen shortly, they did give Visa issuers a little bit of exclusivity in terms of marketability, but the general terms of the partnership, apart from the marketing aspect, can be offered to companies like MasterCard (MA) and American Express (AXP). These other credit card companies will also do great things for PayPal," Luria said.

Shares of Visa are higher 0.53% to $79.21 during afternoon trading on Friday.

(Visa is a part of Jim Cramer's charitable trust portfolio Action Alerts PLUS. See all of Cramer's holdings with a free trial).