PayPal Files Application To Become A Bank

PayPal has taken a fresh step towards becoming a full banking player in the United States. The payments firm has applied for a bank charter, signalling a deeper push into lending and savings services.

The San Jose-based company confirmed it has filed applications with the Utah Department of Financial Institutions and the Federal Deposit Insurance Corporation. The request seeks approval to set up an industrial loan company, often used by non-bank firms entering finance.

If regulators give the green light, PayPal banking would allow the company to expand loans to small businesses. It would also reduce its dependence on external banking partners, which currently support parts of its lending operations.

“Securing capital remains a significant hurdle for small businesses striving to grow and scale,” PayPal chief executive Alex Chriss said. He added that a bank licence would improve efficiency and support economic opportunity across the US.

Why PayPal banking matters now

The PayPal bank application comes as fintech firms test a more relaxed regulatory mood. Since President Donald Trump returned to office earlier this year, regulators have taken a more pro-growth approach. As a result, bank charter filings have increased.

Other digital finance firms have already moved. Last week, the Office of the Comptroller of the Currency gave preliminary approval to crypto groups, including Ripple and Circle. That decision could speed up the integration of digital assets into the wider banking system.

PayPal said its proposed bank would also offer interest-bearing savings accounts. The firm noted that it has already provided more than $30 billion in loans and capital since 2013. With a charter, PayPal banking could scale those services faster.

The company has named Mara McNeill as president of the proposed PayPal Bank. She brings over 20 years of experience in banking and commercial lending. She previously served as chief executive of Toyota Financial Savings Bank.