I think that there is probably a high likelihood of paypal at least buying a bank in the future. If you look at it from their processing standpoint, they could save a lot of money by getting as high up the banking chain as possible. Apart from that they are really trying to push their issuing side of the credit card industry. There is so much more money in issuing credit cards than processing. If paypal were to buy a bank, they could make millions or billions extra per year issuing and processing credit cards, because they would reduce their middle-men and since their volume is so high, those fractions of percents could easily be millions of dollars. I cant say much as to whether it would happen, but it is definitely in their best interest if it is possible. Visa, MasterCard and governments have strict regulations on who can buy banks and what they can be used for, but payment processors buy banks all the time, so I don't think that paypal would be blocked from making a purchase like that. They don't quite fit the traditional ISO / payment processor profile, but they are huge and have a lot of money, and millions of customers. There is really no reason for them not to be able to do it. As to the walmart comment, walmart was trying to buy an industrial loan corporation which they were going to restructure to use for their credit card processing. This was a banking loophole in Utah which was subsequently closed a few months ago, and as far as I know cannot happen anymore. The reason that Walmart was blocked was essentially that as a retail business, their banking practices would be overly biased to their own needs. A bank must do what is in the best interest for the economy and not a business, industry or other private sector. Paypal on the other hand isn't a retailer, and they would not be making an attempt at the same situation.
PayPal doesn't necessarily suck I wouldn't say.. but they are far from perfect! If any real online bank pops up they'll probably be the first.. and if some company starts competition they'll probably think about it right away to dominate their monopoly.
You'll probably never see the two on the same wave. Google has launched their own checkout system a while back which places them in direct competition with Paypal. Since eBay has banned Google Checkout, I don't see you using PP to withdraw your adsense revenue anytime in the near future
They would't want to become a bank, because they couldn't fuck the people sideways if they would. Paypal is good in "making their own rules", they couldn't do that as a bank.
I agree... PayPal will never become a bank because they like to steal people's money because they don't have to follow the strict guidelines that are in place to protect us, the consumer. They froze $3,000 of my hard eaned money for NO reason and I have seen hundreds of like stories on PayPalSucks.com -- They can freeze your money at anytime, for any reason. A real bank can't do that. I recommend people to use Google Checkout (no fees charged for the rest of the year on any sales you make)