Does PayPal charge fees?
Many people still worry about PayPal and the costs that can be incurred when using it, despite the fact that it has long been used as a simple method to pay for products and services online.
PayPal is a secure online payment service that allows you to pay for products using your PayPal account. Simply enter your bank account, credit and/or debit card information, then choose the account to use as your payment option. You can then also choose one as your default payment method, which will be used until you change your mind or need to use a different account.
You can also send and receive money using PayPal. Any payment you receive is transferred to your PayPal account, which you can use to make purchases or gift family or friends, with the balance restored using your specified cards or bank account.
Many online shoppers continue to avoid the service because they believe there are hidden fees associated with using it. Plus, with Apple Pay and Google Pay, online payments are now just as easy to use. But are they right to be skeptical of PayPal?
Does PayPal have fees?
While buying things online or sending money to friends and family is absolutely free, you or the recipient may be charged some fees in specific circumstances.
If you simply use the service to pay for goods and services online, you have absolutely no fees to worry about. All fees related to this type of transaction are paid by the seller.
Likewise, if you simply send money to family or friends, you won’t be charged any fees. This is an easy way to give people money on their birthday or pay back a friend who bought a round of drinks.
There are, however, a number of fees associated with using some of PayPal’s additional services.
Receiving money for goods or services
When you receive money from the sale of goods online or accept PayPal as a method of payment for your services, a fee will be charged. This fee will be 2.9% and a flat fee of $0.30 for domestic online transactions or an additional 1.5% fee for international payments.
Withdraw money from another account
If you need to withdraw your PayPal balance to your bank account, it’s free as long as it’s your linked bank account. However, if you want to make an instant withdrawal to another bank account, the fee will be 1% of the total amount transferred. These fees apply to debit and credit cards.
Convert your funds to another currency
Predicting foreign exchange costs is tricky. The exchange rate used in the transaction is one thing, but the conversion fees are another. Depending on the currencies concerned, it can vary from 3 to 4%.
Credit Card Processing
There are different fees associated with processing credit card payments. These costs can fluctuate (and often do), but they will never deviate greatly. PayPal’s fees are always transparent, so as long as you’re careful when making the transaction, you’ll know precisely how much you’ll be charged.
Credit card processing fees are as follows:
- PayPal Here (point of sale/card reader) charges 2.7 percent.
- A 1.5% fee is added to international PayPal Here transactions.
- For online purchases by credit or debit card, a 2.9% fee plus a flat fee of $0.30 applies.
- International online credit card transactions are subject to an additional 1.5% surcharge.
- Payments made with American Express include a 3.5 percent fee. Whether you pay with a foreign American Express card or a domestic American Express card, the cost remains the same.
Alternative payment services
If you’re still not convinced about PayPal, there are similar alternatives that, like PayPal, can make your online payment processes much simpler than having to enter your card details every time you want to pay for something .
Let’s take a look at the current favorites:
1. Google Pay
Google Pay can be used for in-app purchases as well as transactions in physical stores. Third-party providers may also include this functionality in their online stores. Payment is made in just one click via an app. Credit card information is stored and processed securely, with no payment information transferred to the retailer.
Google Pay has excellent security requirements and can be used independently of Google if that bothers you, although it is not (yet) as widely accepted as PayPal.
2. Apple Pay
If you’re an iPhone user, your alternative to PayPal might be Apple Pay.
The payment service functions first and foremost as an NFC wallet for iPhone, allowing Apple Pay to make contactless purchases at checkout. In-app purchases from a number of well-known companies are also available.
Apple Pay offers excellent security and is useful for online and in-store transactions, but it is only available to Apple fans and is not yet generally available outside the United States.
3. Payer
Payoneer, a money transfer and payments startup founded in 2005 by Israeli entrepreneur Yuval Tal, is particularly well suited to small and medium-sized businesses as well as freelancers. Payoneer is accessible in over 200 countries as a Mastercard approved Membership Services Provider (MSP).
Users can choose to send money to a bank account or to a reloadable prepaid debit card, which can then be used to make purchases. It’s also an attractive choice for cross-border wire transfers due to low currency conversion fees.
4. Master pass
Masterpass was originally offered exclusively to Mastercard users as an alternative to PayPal, but is now open to all credit card holders. Masterpass accepts almost any credit or debit card besides Mastercard.
Masterpass, like PayPal, is considered a digital wallet solution. First you need to create a personal account and fill in payment and personal information. You can discover them simply and quickly in your Masterpass account if you wish to pay online. This eliminates the need to enter your address and payment information separately for each online store.
Jake McEvoy
Jake is a professional writer, journalist, and lifelong tech fan. It covers KnowYourMobile news and user guides.
