📌 Update December, 2022 – PayPal raised the APY (annual percentage yield) on their savings account twice this month. They increased it by another 0.25% APY to the current 3.75% APY (up from 3.50% APY midway through December and up from 3.25% APY to start the month).
PayPal online savings account recent rate history:
- December 3.50% APY
- November – 3.25% APY
- October – 2.75% APY
- September – 1.80% APY


The financial technology company PayPal hardly needs any introduction with over 400 million users worldwide and over $25 billion in annual revenue; they’ve been a household name since their founding in 1998.
What you may not know is that they just launched their highly anticipated high yield online savings account in May of this year and it currently earns an impressive APY of 3.25%.
The account also has no minimum deposit requirements, balance requirements or monthly maintenance fees of any kind.
To learn more about PayPal’s online savings account continue reading our review below.
In this post you'll learn:
PayPal Savings Account Rate + Features


The PayPal Savings account is 100 percent digital. You can download their app here and start saving immediately.
The account has no minimum deposit requirements or monthly balance requirements and all balances are eligible for the advertised rate.
The rate is variable and can change at any time without notice.
PayPal itself is not a bank, however your deposits are FDIC-insured through their partner Synchrony Bank.
APY
Minimum Deposit | APY |
$0 | 3.75% |
To put this yield into perspective, the current national average for a savings account and a money market account sit at just 0.30% and 0.38% APY, respectively, according to recent FDIC data.
The best high yield online savings account rates are a hair above 4.00% APY at the moment and may go up even further as the FED announced another 0.50% prime rate hike on December 14, 2022.
Money Management


Managing your money is straightforward with the PayPal app. You can transfer funds from your bank account or current PayPal balance into the savings account.
From the app you’ll also have access to the following:
- Get your paychecks up to 2 days early when you set up direct deposit.
- Mobile check cashing. Cash a physical check to your account from your phone.
- Set up bill pay. Pay your TV, utilities, internet, phone bills, etc from the app.
- Set up auto-save features and savings goals. Move money from one goal to another if priorities change.
- Get a PayPal Cash Card. No fees or credit checks required. Can be used anywhere Mastercard is accepted.
- Add cash with the app or Cash Card at 100k+ stores across the US, including Walmart, CVS, and 7-Eleven
- Buy, sell and hold cryptocurrencies.
PayPal Savings Account FAQs
If you still have questions about PayPal and their newly launched online savings account, don’t worry we’re here to help. Here are some of the most commonly asked questions by consumers and our responses below.
Is PayPal a Bank?
No.
Peter Thiel, the founder of PayPal, has stated that PayPal is not a bank because it does not engage in fractional reserve banking. Essentially meaning the company does not engage in the act of borrowing and lending their customers’ funds.
Federal Regulators also reiterated this notion back in 2002, stating that PayPal is not a bank and shouldn’t be regulated as such.
That being said, PayPal has dipped their toe into banking products like this online savings account. In the past, they have also tested out money market accounts, lines of credit and even a debit card, which is still offered as the PayPal cash card.
Are PayPal Accounts Insured by the FDIC?
Yes, by proxy.
While PayPal itself is not a bank and is not FDIC-insured, the accounts they offer are through their partner Synchrony Bank (FDIC# 27314).
Final Thoughts
As far as FDIC-insured online savings accounts go, this newly launched PayPal account is fairly competitive – with a yield roughly 12x the national average.
Plus the fact that the account has no maintenance fees, minimum deposit requirements or monthly balance requirements to earn the high rate makes it available to a large swathe of people.
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