PayPal Holdings, Inc. filed applications with the Utah Department of Financial Institutions and the Federal Deposit Insurance Corporation on December 15 2025 to establish PayPal Bank, an industrial loan company that would allow the payments giant to issue FDIC‑insured deposits and offer its own lending products directly to U.S. customers.
The move builds on PayPal’s existing lending footprint, which has supplied more than $30 billion in loans and working‑capital advances to over 420,000 business accounts worldwide since 2013. By creating an in‑house bank, PayPal can reduce its reliance on third‑party lenders such as WebBank, streamline underwriting, and capture the full interest‑margin on small‑business loans.
PayPal Bank would also seek direct membership with major card networks, including Visa and Mastercard, to complement its current merchant‑acquiring and settlement services. The charter would enable the company to launch interest‑bearing savings accounts and merchant‑credit products, providing a new high‑margin revenue stream from both loan interest and origination fees.
Strategically, the charter positions PayPal to compete more directly with traditional banks and fintech lenders. The ability to offer FDIC‑insured deposits and a broader suite of financial products strengthens customer trust, expands PayPal’s ecosystem, and creates cross‑sell opportunities across its payment, commerce, and credit businesses.
In a statement, PayPal CEO Alex Chriss said the bank would “strengthen our business and improve our efficiency, enabling us to better support small‑business growth and economic opportunities across the U.S.” Mara McNeill, former president of Toyota Financial Savings Bank, was named president of the proposed PayPal Bank, bringing extensive banking experience to the venture.
Analysts noted the strategic significance of the charter, highlighting the potential for high‑margin interest income and the ability to capture a larger share of the small‑business lending market. Investors reacted positively, reflecting confidence in PayPal’s ability to leverage its large merchant and consumer base to build a robust financial services offering, while acknowledging that regulatory approval timelines remain uncertain and that existing lending partners such as WebBank may be affected.
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