‘Good for consumers’: PayPal announces a bold new plan for the US that could change how Americans handle their money

PayPal has officially applied to become a licensed bank in the United States. This is a big move that could change how Americans manage their money. The company, which already operates as a bank in Europe from Luxembourg, announced that it sent applications to the Federal Deposit Insurance Corporation (FDIC) and the Utah Department of Financial Institutions (UDFI). If approved, the new bank would be called “PayPal Bank” and would be based in Utah.

This news matters a lot for small business owners and regular people. According to Engadget, PayPal doesn’t just want to handle payments anymore. They want to offer complete banking services. For regular customers, the biggest benefit is that they plan to offer savings accounts that earn interest. If your current bank barely pays you anything on your savings, having a tech company offer better rates is something worth watching.

The main goal of this new bank seems to be helping small businesses. PayPal has already given out over $30 billion in loans and working capital to more than 420,000 business accounts around the world. CEO and President Alex Chriss pointed out that small businesses still have a hard time getting money to grow their companies.

PayPal’s banking move could solve a major problem for small businesses

If the application gets approved, PayPal Bank will be based in Utah. The company plans to offer savings accounts that earn interest for customers. As tech companies expand into financial services, concerns about AI and robotics in various industries continue to grow, with China’s latest robot displaying aggressive behavior.

Many companies have applied to become banks this year, and their chances of approval are higher under the Trump administration. On Friday, the Office of the Comptroller of the Currency (OCC) gave conditional approval to five cryptocurrency companies to become federally chartered trust banks. These companies include BitGo, Circle, and Ripple.

“New banks entering the federal banking sector are good for consumers, the banking industry, and the economy,” said Jonathan V. Gould, the OCC’s comptroller. “They give people access to new products, services, and ways to get credit. They also keep the banking system competitive and diverse.”

PayPal isn’t the only non-bank company trying to enter the banking world. Other companies like Nissan and Sony have also sent in applications to form banks. Meanwhile, Apple’s rumored iPhone design changes show how tech giants continue innovating across different sectors.