PayPal Applies for U.S. Banking License to Launch Full-Service Digital Bank
PayPal Holdings, Inc. has taken a major step toward becoming a full-service digital bank by applying for a U.S. banking license. The move aims to establish PayPal Bank, allowing the company to expand beyond digital payments into lending, savings, and traditional banking services.
The application, submitted to U.S. regulators, would enable PayPal to offer direct loans and savings accounts, reducing reliance on partner banks. This shift is expected to strengthen support for small and medium-sized businesses in the U.S., which often face challenges accessing financing.
Over the past years, PayPal has provided over $30 billion in loans and working capital globally, benefiting hundreds of thousands of businesses. If approved, PayPal Bank will provide more efficient lending, competitive savings accounts, and direct access to payment card networks, along with FDIC-protected deposits, boosting trust and reliability.
The company has formed a dedicated banking team to meet regulatory standards, signaling a strong commitment to compliance. Analysts suggest that entering the banking sector could give PayPal a competitive edge over fintech rivals, diversify revenue streams, and reduce dependence on transaction fees.
The project remains subject to final U.S. regulatory approval, with timelines and services potentially affected by regulatory decisions. PayPal currently operates in around 200 global markets, offering payments, transfers, credit, and working capital solutions, making this banking expansion a natural progression of its long-term growth strategy.
Keywords: PayPal Bank, digital banking, U.S. banking license, PayPal lending, fintech, small business finance, PayPal news, alternative finance, banking innovation