PayPal Partners with OpenAI and Applies to Become a Bank

PayPal has been under a lot of pressure for a while now: there was a rising doubt if paypal can even still compete with Apple Pay or Stripe. But now situation is changing.

This one is a massive move for PayPal; what they’re trying to do is to meet you exactly where you're already spending your time - ChatGPT, and with Agentic Commerce Protocol implementation, PayPal will take a big piece of commerce, at least for a while, before others start to do the same, so you will need to catch this moment.

What This Means for PayPal Stock

Here’s how this partnership can play out

Transaction Volume, this one is important and telling, if even a fraction of ChatGPT’s millions of users start buying things, PayPal's volume will spike. Jump won’t happen tomorrow, setting this up is expensive, but once the base is done, transactions will become very cheap for PayPal to process. Also Wall Street loves an AI story (i wonder why). PayPal branding will move from a boring, old fintech into AI-enabled infrastructure.

Of course the process is not as smooth as one might imagine. The full rollout isn't expected until 2026. It will take time, also there is a question popping up - will people feel comfortable letting an AI handle their credit card info. Governments are already trying to implement some sort of regulation for AI, add to that financial transactions and you will have even more scrutiny.

In late 2025, PayPal applied to establish PayPal Bank, as a Utah-chartered industrial loan company. Currently, PayPal has to use partner banks to hold your money and issue loans. By becoming a bank, they will no longer have to pay middleman fees to other banks to hold deposits or process payments. Will be able to lend money to small businesses directly. Since they have 25 years of transaction data, they can assess risk better than almost anyone, turning lending into a high-profit machine. And with FDIC insurance, PayPal can offer high yield savings accounts. This will keep your money inside their ecosystem longer, making it more likely you'll spend it via PayPal.

PayPal Competitive Advantage

If PayPal receives a banking license and takes a leading position in ChatGPT, the company will become a high-tech service, quite powerful, I’d add. PayPal will move toward owning the entire transaction life cycle.

• ChatGPT handles the discovery, PayPal’s Agentic Protocol handles the logistics, and PayPal Bank handles the funding and settlement.

The biggest obstacle for AI shopping is trust. Users are hesitant to let a chatbot access their bank accounts. By being a regulated bank with FDIC insurance, PayPal provides the safety net that makes agentic commerce actually viable for the average person.

As a bank, PayPal can use real-time AI shopping data to offer instant, personalized credit like "Buy Now, Pay Later" or small business loans to the very users ChatGPT is recommending.

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