PayPal Holdings, Inc. (Nasdaq: PYPL) said it has submitted applications to the Utah Department of Financial Institutions and the Federal Deposit Insurance Corporation to establish PayPal Bank, a proposed Utah-chartered industrial loan company.

Since 2013, PayPal has provided access to more than $30 billion in loans and working capital to over 420,000 business accounts worldwide, filling a critical gap for small businesses seeking capital to expand, purchase inventory, or invest in the people and tools needed to thrive. As proposed, PayPal Bank would enable PayPal to provide business-lending solutions more efficiently to small businesses in the US, while reducing reliance on third parties and strengthening PayPal’s business.

“Securing capital remains a significant hurdle for small businesses striving to grow and scale,” said Alex Chriss, president and chief executive officer of PayPal. “Establishing PayPal Bank will strengthen our business and improve our efficiency, enabling us to better support small business growth and economic opportunities across the US.”

In addition to providing small business-lending solutions, PayPal Bank expects to offer interest-bearing savings accounts to customers. PayPal Bank would also seek direct membership in US card networks to complement processing and settlement activities through existing banking relationships.

If approved, customer deposits at PayPal Bank would be eligible for FDIC insurance coverage. Mara McNeill has been selected to serve as president of PayPal Bank and has more than 25 years of financial services experience in banking, commercial lending and private equity. Before joining PayPal, she served as president and chief executive officer of Toyota Financial Savings Bank.

Re-disseminated by The Asian Banker