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News and resources on payments systems, innovations and initiatives worldwide.

PayPal lets users instantly transfer funds to bank accounts

PayPal is rolling out an Instant Transfer feature in the US, allowing consumers, and soon businesses, to instantly move money that they receive via the service into their bank accounts.

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PayPal lets users instantly transfer funds to bank accounts

Editorial

This content has been selected, created and edited by the Finextra editorial team based upon its relevance and interest to our community.

Instant Transfers is being rolled out to US consumers now, with businesses to get access in the coming weeks and international expansion set for the near future.

The move is part of PayPal's effort to make itself more attractive to new sectors, including gig economy workers - who are increasingly choosing the firm to get paid - by helping them get their hands on their money as quickly as possible.

The firm already offers an Instant Transfer to debit card option and has also targeted businesses with a Funds Now option that gives them access to money from completed sales within seconds.

Says COO Bil Ready in a blog: "Getting faster access to money is becoming more and more critical for most people, especially as the global workforce is evolving and an increase in less traditional and more entrepreneurial jobs means people have potentially less stable and more variable incomes."

"Faster access to your money can also mean being able to cover unexpected expenses and emergencies, staying on top of bills and avoiding late fees. For businesses, getting faster access to money from their sales can mean they can afford to hire more employees, purchase inventory, quickly invest back into their businesses and better manage their cashflow."

The new feature is made possible thanks to a partnership with JPMorgan Chase that gives PayPal access to The Clearing House's real time payments network.

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Comments: (2)

A Finextra member 

Really interesting that the argument still goes on in the US about whether there is a business case for Instant Payments.  The rest of the world thinks so, as does PayPal! It's time for a regulated change, so that everyone can benefit.

Ketharaman Swaminathan

Ketharaman Swaminathan Founder and CEO at GTM360 Marketing Solutions

From personal experience and anecdotal evidence, PayPal is notorious for freezing customers' wallet accounts for "suspected fraudulent behavior" the moment customers initiate transfer of funds from their PayPal wallets to their bank accounts. As long as the funds remain in the wallet, PayPal doesn't seem to suspect any fraudulent activity nor have any problem with taking a cut of the payment towards its fees. Keen on knowing what happens to the count of frozen accounts on the back of this instant transfer feature; also whether the "instant" refers to money reaching the bank account or only to the ability to initiate the transfer to the bank account. For many years, in India, PayPal is required to automatically transfer wallet balance to the linked bank account within 24 hours of receipt but the good funds can be sighted in bank account only after 1-2 days.

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