PayPal Seeks Bank Charter to Enhance Support for Small Businesses
Bank of America business banking President and Co-head Sharon Miller discusses small and mid-sized business costs and the optimism these companies have going into 2026 on ‘The Claman Countdown’.
In a significant move to support small businesses, PayPal announced this week that it has submitted regulatory applications to create a new industrial loan company, PayPal Bank. This initiative aims to provide essential financial services tailored to the needs of small enterprises.
On Monday, PayPal revealed that it filed the necessary documents with the Utah Department of Financial Institutions and the Federal Deposit Insurance Corporation (FDIC) to launch PayPal Bank. This new banking entity is designed to offer lending solutions specifically for small businesses, along with interest-bearing savings accounts. Additionally, PayPal plans to pursue direct membership with card networks, enhancing its processing and settlement capabilities through existing banking relationships.
If PayPal’s application receives approval, customer deposits will be insured by the FDIC, providing coverage up to $250,000 per depositor, per insured bank. This insurance is crucial for small business owners looking for secure banking options.
SMALL BUSINESSES REPORT RECORD MONTHLY SURGE IN PRICE INCREASES AS INFLATION PRESSURE MOUNTS
PayPal announced plans to launch an industrial bank called PayPal Bank that would cater to the financial services needs of small businesses. (Justin Sullivan/Getty Images)
“Securing capital remains a significant hurdle for small businesses striving to grow and scale,” stated PayPal CEO Alex Chriss. “Establishing PayPal Bank will strengthen our business and improve our efficiency, enabling us to better support small business growth and economic opportunities across the U.S.”
To lead PayPal Bank, the company has appointed Mara McNeill as president. With over 25 years of experience in banking, commercial lending, and private equity, McNeill brings a wealth of knowledge to the role. Prior to joining PayPal, she served as the president and CEO of Toyota Financial Savings Bank.
SMALL BUSINESS OPTIMISM RISES, BUT OWNERS SAY QUALIFIED WORKERS ARE STILL HARD TO FIND
Small businesses would be able to access loans as well as depository services at PayPal Bank. (James Carbone/Newsday RM via Getty Images)
Since 2013, PayPal has facilitated access to over $30 billion in loans and working capital for more than 420,000 business accounts globally. This access is vital for small businesses seeking to expand, purchase inventory, or invest in their workforce and equipment.
Industrial banks, like PayPal Bank, are regulated by state authorities and the FDIC if they are members. Unlike traditional banks governed by the Bank Holding Company Act (BHCA), industrial banks are exempt from certain regulations, allowing non-financial companies to own and operate them.
SMALL BUSINESSES LEAD NOVEMBER JOB LOSSES AS TARIFF UNCERTAINTY WEIGHS ON HIRING
PayPal CEO Alex Chriss said that PayPal Bank will help serve small businesses. (Alex Wong/Getty Images)
These banks are subject to the same regulatory and supervisory processes as traditional banks, allowing them to offer a wide range of consumer and commercial loans while accepting federally insured deposits. The recent surge in bank charter applications has been influenced by the Trump administration, which has adopted a deregulatory stance to encourage financial institutions to foster economic growth.
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Last week, the administration’s Office of the Comptroller of the Currency granted preliminary approvals to cryptocurrency leaders Ripple and Circle, allowing them to explore the establishment of national trust banks, further integrating digital assets into the U.S. banking landscape.
Reuters contributed to this report.
Bank of America business banking President and Co-head Sharon Miller discusses small and mid-sized business costs and the optimism these companies have going into 2026 on ‘The Claman Countdown’.
In a significant move to support small businesses, PayPal announced this week that it has submitted regulatory applications to create a new industrial loan company, PayPal Bank. This initiative aims to provide essential financial services tailored to the needs of small enterprises.
On Monday, PayPal revealed that it filed the necessary documents with the Utah Department of Financial Institutions and the Federal Deposit Insurance Corporation (FDIC) to launch PayPal Bank. This new banking entity is designed to offer lending solutions specifically for small businesses, along with interest-bearing savings accounts. Additionally, PayPal plans to pursue direct membership with card networks, enhancing its processing and settlement capabilities through existing banking relationships.
If PayPal’s application receives approval, customer deposits will be insured by the FDIC, providing coverage up to $250,000 per depositor, per insured bank. This insurance is crucial for small business owners looking for secure banking options.
SMALL BUSINESSES REPORT RECORD MONTHLY SURGE IN PRICE INCREASES AS INFLATION PRESSURE MOUNTS
PayPal announced plans to launch an industrial bank called PayPal Bank that would cater to the financial services needs of small businesses. (Justin Sullivan/Getty Images)
“Securing capital remains a significant hurdle for small businesses striving to grow and scale,” stated PayPal CEO Alex Chriss. “Establishing PayPal Bank will strengthen our business and improve our efficiency, enabling us to better support small business growth and economic opportunities across the U.S.”
To lead PayPal Bank, the company has appointed Mara McNeill as president. With over 25 years of experience in banking, commercial lending, and private equity, McNeill brings a wealth of knowledge to the role. Prior to joining PayPal, she served as the president and CEO of Toyota Financial Savings Bank.
SMALL BUSINESS OPTIMISM RISES, BUT OWNERS SAY QUALIFIED WORKERS ARE STILL HARD TO FIND
Small businesses would be able to access loans as well as depository services at PayPal Bank. (James Carbone/Newsday RM via Getty Images)
Since 2013, PayPal has facilitated access to over $30 billion in loans and working capital for more than 420,000 business accounts globally. This access is vital for small businesses seeking to expand, purchase inventory, or invest in their workforce and equipment.
Industrial banks, like PayPal Bank, are regulated by state authorities and the FDIC if they are members. Unlike traditional banks governed by the Bank Holding Company Act (BHCA), industrial banks are exempt from certain regulations, allowing non-financial companies to own and operate them.
SMALL BUSINESSES LEAD NOVEMBER JOB LOSSES AS TARIFF UNCERTAINTY WEIGHS ON HIRING
PayPal CEO Alex Chriss said that PayPal Bank will help serve small businesses. (Alex Wong/Getty Images)
These banks are subject to the same regulatory and supervisory processes as traditional banks, allowing them to offer a wide range of consumer and commercial loans while accepting federally insured deposits. The recent surge in bank charter applications has been influenced by the Trump administration, which has adopted a deregulatory stance to encourage financial institutions to foster economic growth.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
Last week, the administration’s Office of the Comptroller of the Currency granted preliminary approvals to cryptocurrency leaders Ripple and Circle, allowing them to explore the establishment of national trust banks, further integrating digital assets into the U.S. banking landscape.
Reuters contributed to this report.
