CFPB Advises Against Storing Funds in PayPal, Venmo, and CashApp

The Consumer Financial Protection Bureau (CFPB) has warned consumers that money held on mobile payment apps like Venmo, Cash App, or PayPal could be lost if the companies fail since the funds are not automatically insured by the government. The CFPB advises consumers to move money held on digital payment apps to traditional banks and credit union accounts, which guarantee federal deposit insurance. The warning comes as more Americans than ever are using digital payment apps, and transaction volume across all nonbank digital payment services is projected to reach around $1.6 trillion by 2027.