PayPal applies to become a US bank — filings submitted to FDIC and Utah regulator

PayPal has filed applications to form PayPal Bank in the United States, submitting paperwork to the Federal Deposit Insurance Corporation (FDIC) and the Utah Department of Financial Institutions (UDFI). If approved, the bank would be chartered in Utah; PayPal already operates as a bank in Europe (Luxembourg).

The company positions the move as a way to better support small businesses. PayPal says it has provided over $30 billion in loans and working capital to more than 420,000 business accounts globally, and wants a US banking charter to strengthen capital access and operational efficiency.

What PayPal plans to offer

• Interest‑bearing savings accounts for customers.
• Easier access to capital and lending services tailored to small businesses.
• A Utah charter if the applications are approved.

Context: more firms seeking bank charters

The move follows a trend of nonbank firms applying for banking charters in the US. Regulators under the current administration have been more open to new entrants: the OCC recently granted conditional federal trust bank charters to several crypto firms, and other companies such as Nissan and Sony have also submitted banking applications.

Supporters argue that new entrants expand product choice and credit access, while critics raise questions about regulatory oversight, consumer protection and concentration of financial data in large tech platforms.

Potential implications

• For small businesses: A PayPal bank could streamline lending and deposits for merchants already embedded in PayPal’s ecosystem.
• For consumers: Interest‑bearing accounts could add a banking alternative, but details on rates, fees and protections remain to be seen.
• Regulatory scrutiny: Approval will depend on safety, soundness, and consumer‑protection considerations; state and federal regulators will assess the applications.

PayPal’s filings mark an important step in the company’s evolution from payments firm to a broader financial services provider. Watch for regulatory feedback and any conditions attached to a potential charter.

For further reading and updates, check official filings from the FDIC and Utah regulators as they become public.

Discussion: Should big fintech platforms like PayPal hold bank charters — would it improve services for small businesses and consumers, or concentrate too much financial power in tech companies?