PayPal Seeks Utah Bank Charter to Enhance Lending and Crypto Payment Operations
PayPal has filed with the Utah Department of Financial Institutions and the FDIC to establish a Utah-chartered industrial bank. This move aims to allow the company to originate loans, hold customer deposits, and access payment networks directly, thereby reducing reliance on third-party banks.
The bank charter would bolster lending and payments infrastructure specifically for small businesses in the U.S., addressing challenges highlighted by CEO Alex Chriss, who identified securing capital as a significant hurdle for small enterprises.
Additionally, the charter supports PayPal's expanding cryptocurrency and PYUSD stablecoin settlement operations within a regulated banking framework. The company has integrated crypto into its payments network through consumer trading, merchant acceptance, payouts, and on-chain settlement, with PYUSD now deployed across multiple networks.
In July, PayPal enabled merchants to accept Bitcoin and Ethereum at checkout via point-of-sale conversions to fiat for settlement. Earlier in the month, PYUSD also began facilitating earnings payments for U.S. YouTube creators, extending creator payouts and settlement.
Analysts note that PayPal's application reflects a broader fintech industry trend toward obtaining more direct control over regulated financial infrastructure. This trend corresponds to growing consumer demand for easier movement between digital assets and traditional finance.
