Paypal is NOT a bank

I find it funny how there are some American out there telling me that Paypal IS a bank.

Their recent policy of increasing the fee have been very much a problem to most merchants out there. And no, I'm not a Paypal merchant.
I will buy with Paypal, but not sell with Paypal, generally because Paypal will treat you different if you are a buyer, means you can just file a chargeback on your credit card company in case something is wrong, and Paypal can do nothing but forces the seller to return back their money.

I was once a merchant, who uses Paypal but quit as soon as they held my money while asking me to confirm identity in fear that I am laundering money. Funny part? They claim that my $180 USD fund is what I'm trying to launder out of Thailand.

What defines a bank?
Simple, as long as your country's bank, in my case, Bank of Thailand, considers it as a bank, it is a bank.
But Paypal is NOT a bank. They could never be a bank unless they improve their standard.

(This forum discusses that Paypal is a bank, to which I found amusing:

"Peter Thiel the founder of PayPal, has stated that PayPal is not a bank because it does not engage in fractional-reserve banking.  Rather, PayPal's funds that have not been disbursed are kept in commercial interest-bearing checking accounts.
In the United States, PayPal is licensed as a money transmitter on a state-by-state basis.  PayPal is not classified as a bank in the United States, though the company is subject to some of the rules and regulations governing the financial industry including Regulation E consumer protections and the USA Patriot Act.
In 2007, PayPal Europe was granted a Luxembourg banking license, which, under EU law, allows it to conduct banking business throughout the EU.  It is therefore regulated as a bank by Luxembourg's banking supervisory authority, the Commission de Surveillance du Secteur Financier (CSSF).
In Australia, PayPal is licensed as an Authorised Deposit-taking Institution (ADI) and is thus subject to Australian banking laws and regulations."

As Paypal are not bank in most parts of the world, they have the authority to hold your money, confiscate it, increase their fee, etc. without you consent.

Also, check these forums out if you are wondering about Paypal's fee increment:


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