Account-holders enter their login ID and password as normal, but are then prompted to enter a six-digit code provided by a credit card sized hardware security key or a text message sent to the account holder’s mobile phone. Although PayPal is not classified as a bank, 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. PayPal has disabled sending and receiving personal payments in India, thus forcing all recipients to pay a transaction fee. After fine-tuning PayPal’s business model and increasing its domestic and international penetration on eBay, PayPal started its off-eBay strategy. The service also appealed to auction buyers because they could fund PayPal accounts using credit cards or bank account balances, without divulging credit card numbers to unknown sellers. In December 2025, PayPal applied with the state of Utah and the Federal Deposit Insurance Corporation to form PayPal Bank, intended to provide loans to small businesses.