Why is the PayPal Student Account being discontinued?

[PayPal_Drew]

Hi Community!

If you are new, thanks for coming to the community forums to understand more about what's happening with the Student Accounts. Feel free to check out any of the other articles while you're here!

We are aware that this may be an inconvenience for some, so we'd like to thank you for understanding the change. Below are some common questions that we have received. If you have any additional questions, please reply to this thread and the community can respond to you.

Why is the PayPal Student account being discontinued?

PayPal has decided to close PayPal Student Accounts and PayPal Student Debit MasterCards on the following dates:

     • Effective September 29, 2016, PayPal Student accounts will no longer be able to make purchases online.
     • Effective September 29, 2016, the PayPal Student Debit MasterCard® card, and related services, will be closed.
     • Effective November 15, 2016, the PayPal Student account will be closed.

What happens to the money in the Student account balance?

Any money that is not spent from the Student account prior to November 15, 2016, will be moved to the student’s parent’s PayPal account. The student account will no longer be able to make purchases effective September 29, 2016. You will still be able to send and withdraw money until November 15, 2016.

Is there a replacement product?

At this time, we aren’t introducing a replacement for PayPal Student Accounts and PayPal Student Debit MasterCards. We will continue to explore ways to serve our younger population in the future. If the student is over 18 years old, we invite them to sign up for a PayPal account so they can enjoy the benefits PayPal offers, such as sending, receiving, and spending money online and in-stores. We appreciate your business and apologize for any inconvenience.

Because the Community Forum isn't actively monitored by our Customer Service team, please reach out to us via phone if you require immediate assistance. You can do this by visiting the "Help & Contact" link on any PayPal webpage, selecting "Call Us", and continue as a guest if you're not logged in to your account. 

If this post is helpful, please accept it as a solution or provide kudos. 

Thanks! 

- Drew

[Mekjek]

Is PayPal ending student accounts?

[DPCreations]

Apparently.  If you have such an account I think you should have received a notice.

Check other recent postings for a copy of the email from another.

[Emtr42]

What I want to know is what to do now. My three students rely on their PayPal debit card, and have for the past six years, in leiu of a bank account. PayPal isn't thinking ahead, these are their near-future loyal customers they are dropping. Will students be able to get a PayPal account, a PayPal prepaid debit card? Right now, they can't get a regular PayPal account with their email address, because they used it for the student account! I think PayPal should waive the email address lock rule for former student debit card holders. Now I need to get a bank account and PayPal for each of my kids, because you've ended this product, but PayPal doesn't make that easy!! These are loyal customers that have been paying fees to PayPal for years!! Give us something, at least a little ease in continuing to use PayPal.

[Dlncook]

I just got the email and I am also so upset! I have used this with my son for four years and was about to add my second. This has been a godsend for us and there is nothing similar out there. The security of being able to see their spending, not being able to spend more than they have, and sending them money when they need it immediately it something I can't imagine not having anymore! I can't figure out if or how to switch to regular account with debit card. I'm so disappointed PayPal!!!

[Dlncook]

Honesty, I could understand them not starting anymore new accounts, but why not grandfather in the students who are already using and depending on these accounts? 😞

[CamFam]

I am disappointed. And what surprises me is it appears as though you can still set up student accounts. I didn't see any information regarding the discontinuation of these accounts anywhere on the website.

Here are some thoughts on what to do now...

Contact your bank and explain your situation and see if they have any solutions.

Depending on the age of your student, the laws in your state, and the bank's policies, your student may be able to open a checking account with debit card. (Just don't give your student any checks.) You will want to set it up as a joint account so you can access the information and monitor the account online, as well as have the ability to transfer money between your account and theirs. In that scenario, your student can set up their own access online, but wouldn't be able to see or access any of your accounts. Be sure to ask about potential overdrafts. Some banks allow debit transactions to go through even if their systems are offline, potentially opening you up to overdraft fees (or a learning experience, depending on how you look at it). But other banks do not allow debit transaction unless the system can verify funds and therefore preventing any overdrafts. 

Another option - Some banks have the ability to add you as POA on an account instead of a joint account holder. Again, this will vary by state and bank. With this option, the account is in your student's name, but you still have full access. If your bank does this, they will have all the forms necessary. The POA (Power of Attorney) is specific only to that account and nothing else.

I have set up accounts like this with my kids, and it has worked out quite well. They have their own accounts but I can see their activity and transfer money easily. (Especially helpful when they are away.) They downloaded the bank's app and can easily monitor their own accounts through that.

I hope this helps in some way.

[DPCreations]

If you are unhappy with PayPal business polcies, it's best to phone PayPal and let them know.

[JJL727]

After waiting on hold for 20+ minutes last night, and another 15+ minutes today, with no one picking up at the Debit Card department, just so that it will wind up in the circular file...nah....

[Mskrisanda]

Tried doing this and got someone who knew nothing then transferred me to somewhere I spent 15 min oh hold and gave up!