PayPal is moving deeper into plain vanilla banking, with plans to roll out a new debit card for online and offline shopping and an FDIC-insured cheque deposit system for account holders.
The new services, slated for introduction in the coming weeks, are being offered “in collaboration with some of the leading financial institutions in the US”, says the company.
PayPal says the move is intended to target unbanked US consumers “in order to give access to financial services that are less expensive, less time-consuming and more convenient”.
The PayPal Cash Mastercard will let users access the money in their PayPal account to shop online or in stores and withdraw cash from ATMs anywhere Mastercard is accepted.
People who don’t have a bank account will also be offered the opportunity to directly deposit their paycheque into their PayPal account for free. Customers who enroll in these features will be eligible to receive FDIC pass-through Insurance on the funds held in their PayPal account, with no minimum balance required.
According to the Wall Street journal, the firm is skirting US bank licensing rules by partnering with several small banks that can provide those services, including a Delaware bank that will handle debit cards, a bank in Georgia for mobile cheque deposit and a Utah bank for offering loans to customers and small businesses.