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PayPal might not be the first name that comes to mind when you’re looking for a savings account to store your cash. After all, the popular financial technology company isn’t a bank. Yet PayPal does provide some banking services, including check cashing and PayPal Savings. With no fees and a competitive 4.30% annual percentage yield (APY), there are plenty of reasons to like this digital savings solution.

You can also use the PayPal app to manage your finances in other helpful ways. Digital wallet features can help you store credit card, debit card, and bank account details in one convenient location. And you can use PayPal to accept Direct Deposit and pay your bills.

There's even an opportunity to earn up to 10% cash back when you make eligible purchases using PayPal (more details below).

If you haven’t used PayPal in a while, or if you’ve only used it to send or receive payments, there’s a good chance you’re missing out on some of the newer capabilities it has to offer. Read on to discover some of the highlights that might interest you most, along with the pros and cons to consider before deciding whether PayPal could be a good fit as a personal banking service.


  • High Savings Interest Rate
  • No Minimum Account Balance Requirement
  • No Monthly Service Fees
  • Check Cashing Option
  • Receive Direct Deposit
  • Access Paychecks and Government Payments Up to 2 Days Early (If Eligible)
  • Rewards-Earning Potential


  • No Checking Account, Money Market Account, or CD Options
  • No Joint Account Option
  • No In-Person Branches
  • Can Take Up to 6 Business Days to Transfer Funds From a Bank Account
  • Savings Account Is Not Available to Business PayPal Account Holders

PayPal Savings

PayPal Savings is an offering that’s available through the PayPal platform in partnership with Synchrony Bank (Member FDIC). The savings account option is available to personal PayPal Balance account holders in the United States, but it’s not an option on business PayPal accounts.


PayPal Savings essentially functions as a high-yield savings account. At the time of writing, deposit account holders can receive 4.30% APY on the funds they deposit in their PayPal Savings account—a rate that’s over ten times higher than the national average.

According to the Federal Deposit Insurance Corporation (FDIC), the average interest rate financial institutions paid on savings accounts as of April 2024 was 0.46%. By comparison, some of the best high-yield savings rates at the time of this writing are at or above 4.50% APY.

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Of course, the interest rate isn't the only factor to consider when you choose the best savings account for your situation. Another perk PayPal Savings users can enjoy is the lack of monthly service fees. And unlike some other banks, there are no hoops to jump through to qualify for a fee waiver.

Minimum Deposit Requirement

Another benefit of the PayPal Savings account is its lack of a minimum deposit requirement. You don’t have to worry about depositing a specific amount of money (nor maintaining a minimum balance) to keep your account open and in good standing.


On top of a higher-than-average interest rate and no monthly service fees, PayPal Savings account holders can enjoy several other benefits.

  • Savings Goals: Create custom goals to save for specific purposes (like sinking funds) and track your progress. 
  • Automatic Transfers: Schedule automatic savings transfers from a linked bank account or PayPal balance into your PayPal Savings account (and cancel any time). 
  • Unlimited Withdrawals: Withdraw funds from your savings account as often as you like without limitations.

How to Open a PayPal Savings Account

You can open a PayPal Savings account through the mobile app or on the PayPal website. In the app, visit the “Finances” tab and click the "PayPal Savings" page to get started. Online, under the "Personal" menu, select "Savings and Goals" and then "Start Saving."

To be eligible for a PayPal Savings account, you’ll need an open PayPal Balance account. You may also need to confirm certain personal information like your name, Social Security number, and date of birth.

To add funds to your PayPal Savings account, you have three options:

  • Transfer money from your PayPal balance
  • Transfer funds from a linked bank account.
  • Add money from a linked Visa® or Mastercard® debit card.

When moving funds from a linked bank account, be prepared to wait approximately six business days.

PayPal digital wallet


PayPal Digital Wallet

PayPal is a trusted household name that is widely accepted by many retailers. Its digital wallet makes it easy to securely organize your preferred payment methods, and even earn some extra rewards on your purchases.

One of the many ways you can use the PayPal app is to set up a digital wallet through your PayPal account. You can then link multiple credit cards, debit cards, and bank accounts to your account. Once you complete this step, you can conveniently choose the payment method you want to use at checkout, track your spending, monitor payments, and even pay with credit card rewards from one location — your PayPal app.

It’s worth noting, however, that you may not want to cash in your credit card rewards on purchases with retailers. Often the points and miles you earn may be worth more if you redeem them in a different way (like redeeming them for free travel).

Earn Up to 10% Cash Back on Purchases

Through August 31, 2023, you can earn up to 10% cash back by using PayPal to make a purchase. Here's how it works:

  1. Click the invitation link
  2. Make at least one eligible purchase with your valid PayPal account by August 31
  3. Receive PayPal Rewards Points for the purchase(s), redeemable for up to 10% cash back, for a maximum of $30 (equal to 3,000 Points)

Your PayPal Rewards Points should appear in your account within 14 days but may arrive sooner.

There are some restrictions on how you can use your cash back reward. For example, you can't use it for send/receive money transactions, including for goods and services,or for any transaction made in a foreign currency.

You must be a U.S. resident age 18 or older and have a U.S. personal account with PayPal in good standing to be eligible for this offer.

Other PayPal Features

In addition to PayPal Savings and digital wallet, you can use PayPal to simplify your financial life in other ways.

Cash a Check Service

PayPal doesn't have a full suite of deposit accounts, such as checking accounts, money market accounts, certificates of deposit, etc. PayPal users can open a savings account only.

However, the app does include some limited features that might appeal to consumers who lack a traditional checking account. The PayPal Cash a Check service (available in partnership with Ingo Money, Inc. and First Century Bank, N.A.) is one such example. With this feature, you can cash checks and have them credited to your PayPal Balance account from your mobile device in one of two ways.

Expedited Funding

Receive fast access to eligible funds for a fee. For approved payroll and government checks (with pre-printed signatures), a fee of 1% will apply with a minimum of $5.00. All other accepted checks will incur a 5% fee with a $5.00 minimum.

Delayed Funding

Receive free check cashing for no fee with a 10-day delayed funding period.

If you’re looking for a digital check cashing option, you might want to research what some of the best online banks have available. There are many free checking accounts to consider if you prefer to avoid fees. And with those options, you shouldn’t have to endure a 10-day wait before you can access your funds.

Direct Deposit

Consumers who lack a traditional bank account may also use PayPal as a means to receive their Direct Deposit from an employer or the government. In fact, if you set up an eligible Direct Deposit payment, you might even be able to access your funds up to two days early.

When you use PayPal for Direct Deposit, the funds you receive appear in your PayPal balance. From there, you can use the money to pay eligible bills, shop, send money to others, or transfer funds to PayPal Savings.

Rewards-Earning Debit Card

Linked to your PayPal Balance, you can get a no-fee debit card from PayPal to use anywhere Mastercard is accepted. With the PayPal Debit Card, issued by The Bancorp Bank, N.A., you may also earn rewards on eligible purchases, such as groceries and gas, that are redeemable for cash back.

The PayPal Debit Card includes free access to MoneyPass® ATMs to withdraw cash, has no monthly fee or minimum balance requirement, and does not require a credit check to get.

If you have a PayPal Savings account, you can transfer money from it to your PayPal Balance and use the debit card to make purchases in stores and online or withdraw the money at an ATM.

Is PayPal Right for You?

PayPal has long been recognized as a convenient, safe way to pay online and send money between family and friends. Yet its newer features, like PayPal Savings and digital wallet, offer benefits consumers can use on a daily basis as well.

If you’re looking for a convenient way to earn more interest on your savings and stay on track with multiple savings goals, PayPal Savings might appeal to you. PayPal’s digital wallet services could also simplify the process of tracking multiple accounts and transactions in a single location.

However, it’s also important to understand that PayPal comes with limitations that prevent it from being a stand-alone banking solution for many people. And when it comes to any type of deposit account – savings or otherwise – it’s smart to shop around for the best deals available deals available for your situation.


Michelle Lambright Black

Michelle Black is founder of and Michelle is a leading credit card journalist with over a decade and a half of experience in the financial industry. She’s an expert on credit reporting, credit scoring, identity theft, budgeting, small business, and debt eradication. Michelle is also a certified credit expert witness and personal finance writer.