News

Paypal is now officially a bank - in Europe.

Two months after eBay set up a new entity in Luxembourg, its PayPal subsidiary was granted a banking license for the European Union by the Commission de Surveillance du Secteur Financier (CSSF) in Luxembourg.

Reports AuctionBytes.
The Commission de Surveillance du Secteur Financier in Luxembourg have awarded PayPal a banking licence, and the ebay company will be moving their headquarters over to Luxembourg early next month.

This is big news, PayPal have maintained from the start that they are not a bank, but a mere payment facilitator, that doesn’t seem to be the case any longer.

Paypal has been operating in Europe for years without requiring to be recognized as a bank, neither were there any news recently that paypal would need to become a bank if they are to operate in europe.

PayPal said on Tuesday that the new banking license would allow it to continue its European expansion by offering its services to more online merchants across Europe.

It would be interesting to watch PayPal in the coming months. Who knows, they might even apply for bank status in the US and other parts of the e-commerce enabled world - Google checkout has suddenly become a major player out of nowhere in a market where paypal was a near monopoly, looks like this is one smart move to stay competitive, We should see some major slashes in paypal fees and some google checkout-like offers to attract merchants to use paypal soon!.

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