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PayPal Review 2024: Pros, Cons, Costs

PayPal Review
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Updated February 5, 2024

PayPal is a popular payment app that allows users to send money to family and friends and pay businesses for goods and services. It's one of the oldest payment apps, with a history dating back more than two decades. Today, PayPal manages approximately 435 million accounts, accounting for over $22 billion in transactions.

Paypal

Paypal Money Management App

Paypal Money Management App

Fees
PayPal’s Pay in 4 is interest-free, with no late or sign-up fees. With Pay Monthly, you may pay simple interest depending on your annual percentage rate (APR), but you won’t pay any late or sign-up fees.
Monthly fee
None for online-only payments
Features
Money transfers, PayPal Pay In 4, Digital Wallet, Banking and financial services

Here's a closer look at the payment app, how it works, and how it compares to its competitors.

How does PayPal work?

You can sign up for a free PayPal account online or through the PayPal mobile app, available for iOS and Android. Once you've set up an account, you can link your payment cards—credit and debit cards—and bank accounts to your PayPal account.

PayPal users can send, receive or request money from anyone with a PayPal account. To do so, you'll need the individual's PayPal username, mobile phone number, or email address. Accounts come with a unique PayPal.me link and QR code you can also use for money transfers. PayPal transfers are great for sending money to family and friends, splitting rent with your roommates or splitting the bill at a restaurant.

When shopping online, many merchants include PayPal as a payment option, allowing you to quickly pay for the transaction using any of the saved payment methods and billing addresses from your PayPal account. Users are also able to use PayPal in-store by loading their digital wallet and choosing PayPal at checkout. PayPal is available for individuals and businesses.

Pros and cons

Pros:

  • Widely used by merchants and individuals
  • Flexible transfer options
  • No fees to send money to family and friends

Cons:

  • Fees on select transactions
  • Bank transfers take several days
  • Recent data breach of user account information

Benefits of PayPal

1. Money transfers

PayPal makes it easy to send, receive, or request money with family and friends securely. You can send money from your PayPal balance or a linked bank account, debit card, or credit card. You must have a PayPal account before you can send or receive money transfers.

2. PayPal Pay In 4

Pay in 4 is PayPal's buy now, pay later payment-loan, installment-loan program. It allows you to split purchases into four smaller payments made every 15 days, starting with an initial down payment. Pay in 4 appears as a payment option for online orders between $30 and $1,500 when you check out with PayPal at participating merchants.

PayPal does not charge fees or interest with Pay in 4, but you must have an account in good standing and be approved by PayPal to use the service.

3. Digital Wallet

With PayPal, you can add payment cards and bank accounts to your digital wallet. Users can change their payment preferences at any time directly in the mobile app.

4. Banking and financial services

PayPal recently started to offer banking services through a partnership with Synchrony Bank. PayPal Savings offers high-yield interest savings with no minimums or monthly fees. You can also use PayPal for mobile check cashing, direct deposits, and to pay bills. The payment app even allows users to buy, sell and transfer select cryptocurrencies.

Considerations with PayPal

Fees

It's free to send and receive money with family and friends using your PayPal balance or a bank account. There's no fee when you use PayPal as the payment method when shopping online. It's also free to transfer money to a bank account through a standard transfer.

PayPal charges fees on other types of transactions, including:

  • Sending money to personal connections with a card.
  • International transfers.
  • Receiving donations.
  • Currency conversions.
  • Instant withdrawals from your PayPal account.
  • Cryptocurrency purchases, sales and transfers.

Transfer times

When you withdraw money from your PayPal account to a linked bank account, you have two options to choose from—an instant transfer or a standard transfer. Instant transfers generally show up in your bank account within minutes. Standard payments usually take one business day to complete but can take up to five business days in some instances. Standard transfer to a debit card generally takes 48 hours.

Scams

With more than 400 million accounts, PayPal is a popular payment app for consumers. Unfortunately, it's also a popular option for scammers. According to PayPal, users are frequently targeted with various scams, including phishing emails and messages, shipping scams, fake charities and prize winnings.

How much are PayPal fees?

As mentioned, PayPal charges a fee on select transactions. Here's how much PayPal charges for the following transactions:

  • Sending money to personal connections with a card: 2.90% + fixed fee (based on the currency received).
  • International transfers: 5% ($0.99 minimum; $4.99 maximum).
  • Receiving donations: $0, $2.89% + fixed fee or 2.99%.
  • International donations: 1.50%.
  • Currency conversions: Up to 4% or more.
  • Instant withdrawals from your PayPal account: 1.75% of the amount transferred.
  • Cryptocurrency purchases, sales and transfers: A flat fee or a percentage based on the purchase or sale amount.

How does PayPal stack up?

PayPal has millions of users, but it isn't the only payment app available for consumers. Here's a look at how PayPal stacks up against other popular payment platforms.

Paypal
Venmo
Cash App
Fees
From free to 5%, depending on transfer type
From free to 3%
Free to 1.75%
Max transaction limit
Up to $60,000 per transaction for verified accounts
Up to $5,000 per transfer to your bank, up to $10,000 per week into your Venmo account
Up to $1,000 per 30-day period for unverified accounts, may be higher for verified users
# of countries
200+
1
2

PayPal vs. Venmo

Venmo is a peer-to-peer (P2P) app used primarily for sending and receiving money with other individuals. The popular app has expanded to include other payment and financial features, including direct deposits, mobile check cashing, crypto (“buy, hold, transfer, and sell"), and credit and debit cards for adults and teens. It also offers business accounts and ways to send money to businesses. PayPal is available for use in over 200 countries, while Venmo is only offered in the U.S. Both offer similar features and are relatively easy to use.

PayPal vs. Cash App

Cash App is a full-service peer-to-peer payment app. While it's not as readily available as a payment option online, it offers a host of services, including sending and receiving money, banking, stock investing, Bitcoin and even free state and federal tax filing.

Both Venmo and Cash App are accessible online or through their mobile apps. Similar to Venmo, Cash App's availability is limited, with options for accounts in the United States and United Kingdom only.

PayPal vs. Apple Pay

Apple Pay is a digital wallet specifically for iPhone owners, who can add credit and debit cards to the Wallet app on their iPhones. Then, they can use the app from other Apple devices, including Apple Watch, Mac, and iPad.

Apple Pay is relatively new compared to PayPal but has cast a wide net. It's accepted as a form of payment at more than 85% of retailers in the U.S. and millions of websites and mobile apps. And because it's tied to your iPhone, it comes with the option of additional security measures such as Face ID, Touch ID, and passcode.

How to create a PayPal account

Paypal

Paypal Money Management App

Paypal Money Management App

Fees
PayPal’s Pay in 4 is interest-free, with no late or sign-up fees. With Pay Monthly, you may pay simple interest depending on your annual percentage rate (APR), but you won’t pay any late or sign-up fees.
Monthly fee
None for online-only payments
Features
Money transfers, PayPal Pay In 4, Digital Wallet, Banking and financial services

You can sign up for a free PayPal account online or through the PayPal mobile app. You can also sign up for an account while shopping online when you choose PayPal as the payment method. To create an account follow these steps:

  1. Select account type: You can choose from an individual or business account.
  2. Create login: Enter your name and contact information, and set a password for your account.
  3. Link accounts: Once your account is set up, you can navigate to your account settings to link any bank accounts or payment cards you want.

How to use PayPal

PayPal is simple to use. You can access your account online or through the mobile app. It's also available any time you choose PayPal as your payment method when shopping online.

Once you've accessed your account, you can use PayPal in a number of ways, including:

  • Send, receive, or request money from family or friends.
  • Send money to a business.
  • Pay for online purchases.
  • Store payment cards and accounts in your digital wallet.
  • Pay bills.
  • Save money.
  • Buy and sell cryptocurrency.
  • Raise money for charity.

How to send money via PayPal

You can send money to another person through your online account or the PayPal app. To send money to someone else through the PayPal website:

  1. Log into your online account.
  2. Navigate to "Send and Request."
  3. Enter the recipient's name, PayPal username, email address or mobile number and click "Next."
  4. Enter the payment amount and currency.
  5. Include a note, if desired, then click "Next."
  6. Select your payment method and click "Send Payment Now."

To send money via the PayPal mobile app:

  1. Log into the mobile app.
  2. Tap "Payments."
  3. Enter the recipient's name, PayPal username, email address or mobile number.
  4. Enter the payment amount and currency type.
  5. Include a note, if desired, then tap "Next."
  6. Select your payment method and tap "Send."

Requesting money through PayPal

You can also request payment from other people through PayPal. To request money:

  1. Log into your PayPal account.
  2. Click the "Request" button.
  3. Choose someone from your contact list or enter the person's username, email or phone number in the request form.
  4. Enter the amount you want to request.
  5. Add a note or message, review your request and click "Request Now."

More about PayPal

Who created PayPal?

PayPal was originally formed under a different business name—Confinity. The company was founded in 1998 by Max Levchin, Peter Thiel, and Luke Nosek. In 1999, the company was renamed PayPal.

Who owns PayPal?

PayPal is owned by several investor groups, including Vanguard Group and BlackRock. The payment-processing company was purchased by eBay in 2002 and later spun off into a separate company in 2015.

On August 14, 2023, PayPal Holdings, Inc. announced that it was naming Alex Chriss the company's new president and CEO, effective Sept. 27, 2023.

How to contact PayPal

PayPal offers several ways to contact customer support if there is an issue with your account or transactions or if you have questions. Users can chat online with a PayPal assistant by navigating to the Message Center within their account. You can also call PayPal customer service at 1-888-221-1161 using the phone number attached to your account.

Is PayPal safe?

PayPal employs several security measures to protect users' personal and financial information. Unfortunately, the company is still susceptible to security attacks. Paypal experienced a data breach in December 2022 that affected approximately 35,000 user accounts. The company began notifying the affected users on January 19th, 2023. There is a pending class action lawsuit filed against PayPal in relation to the data breach.

Paypal

Paypal Money Management App

Paypal Money Management App

Fees
PayPal’s Pay in 4 is interest-free, with no late or sign-up fees. With Pay Monthly, you may pay simple interest depending on your annual percentage rate (APR), but you won’t pay any late or sign-up fees.
Monthly fee
None for online-only payments
Features
Money transfers, PayPal Pay In 4, Digital Wallet, Banking and financial services

TIME Stamp: PayPal offers convenient payments

PayPal is a popular choice for payments and sending or receiving money for a reason. It's convenient and easy to navigate, and offers several options to meet various consumer needs. Follow best practices and personal safety measures to protect your account information against phishing scams.

Frequently asked questions (FAQs)

Is PayPal free to use?

PayPal is free for certain transactions, such as sending money to friends or relatives or transferring funds to and from your account to a bank account. There is also no fee to use PayPal at checkout for purchases using your PayPal balance or a linked bank account. Other transactions, including currency conversions or sending money to a business, come with fees.

How do you delete a PayPal account?

You can close your PayPal account online by navigating to your online account settings and choosing "close your account" under account options. To close your PayPal account through the mobile app, tap on your profile icon, then tap "Close your account."

How do you cancel a PayPal payment?

Users cannot cancel a payment once it is completed. Instead, you can contact the seller to communicate and resolve any issues. If you don't reach a resolution, you can report a dispute online or through the mobile app within the PayPal Resolution Center.

The information presented here is created independently from the TIME editorial staff. To learn more, see our About page.

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