Banana streak virus (BSV) is a plant dsDNA pararetrovirus (family Caulimoviridae, genus badnavirus). Although integration is not an essential step in the BSV replication cycle, the nuclear genome of banana (Musa sp.) contains BSV endogenous pararetrovirus sequences (BSV EPRVs). Some BSV EPRVs are infectious by reconstituting a functional viral genome. Recent studies revealed a large molecular diversity of episomal BSV viruses (i.e., nonintegrated) while others focused on BSV EPRV sequences only. In this study, the evolutionary history of badnavirus integration in banana was inferred from phylogenetic relationships between BSV and BSV EPRVs. The relative evolution rates and selective pressures (dN/dS ratio) were also compared between endogenous and episomal viral sequences. At least 27 recent independent integration events occurred after the divergence of three banana species, indicating that viral integration is a recent and frequent phenomenon. Relaxation of selective pressure on badnaviral sequences that experienced neutral evolution after integration in the plant genome was recorded. Additionally, a significant decrease (35%) in the EPRV evolution rate was observed compared to BSV, reflecting the difference in the evolution rate between episomal dsDNA viruses and plant genome. The comparison of our results with the evolution rate of the Musa genome and other reverse-transcribing viruses suggests that EPRVs play an active role in episomal BSV diversity and evolution.