PayPal Applies For Its New Grift Of Becoming a Bank (And Depriving Consumers w/ 0.01% APYs)

“I identify as a… government-backed ponzi scheme that pays you 0.01% APY to hold your money hostage while we gamble it on commercial real estate and charge you $35 whenever you're too poor bank” - PayPal 

Congrats to the Paypal cartel… after spending two decades insisting it’s definitely not a bank, it has officially applied… to become a bank. 

(Source: RedBubble) 

According to reports, the plan is to form an industrial loan company (read: a fintech cheatcode)... which lets PayPal do bank things without becoming a real bank-bank. Think small business loans. Savings accounts. More control over deposits. Less begging JPMorgan for permission slips. 

(Source: Bloomberg) 

Naturally, this move has been a long time coming. PayPal already holds your money against its will. It already lends money. And it already freezes accounts at the most random times imaginable. The only thing missing was the word “Bank” on the door. But why now though? Good question. Other than the fact that PayPal has been cooked… as the stock is down -30% this year, regulators are loosening up and fintech is getting a longer leash, PayPal saw the window and didn’t overthink it. Apply now. Ask forgiveness later. Worst case, they get told no and keep doing exactly what they’re doing today. Best case… they get to milk American consumers for all the money they are worth (see “fees” for context). 

Of course, management will tell you this is about “supporting small businesses” and “expanding access to financial services.” Sure. Maybe. But the real prize is cheaper funding, higher margins, and not being a dumb pipe anymore. Plus, Banks make money because they own deposits. Fintechs, on the other hand, struggle because they rent them. And right now, PayPal is tired of renting.

(Source: Giphy) 

Which now begs the question: If PayPal becomes a bank, Apple is halfway there, and Stripe already acts like one… t exactly are traditional banks protecting at this point? Because from where this looks like it’s going, the next decade of “banking innovation” is just tech companies quietly filling out paperwork while legacy institutions argue over branches.

Obviously, only time will tell how this all shakes out. But for now, enjoy your new savings account degenerates. Until next time, friends… 

At the time of publishing, Stocks.News holds positions in Apple as mentioned in the article.