Is PayPal safe? Here's what you need to know

Zorica Lončar

PayPal is a popular way to shop online, and send and receive payments for both personal and business reasons. If you’re a PayPal user or considering signing up for an account, you may be wondering how the system works.

And of course, there’s the crucial question - is PayPal safe to use? In this guide, we’ll cover all the security essentials you need to know about using PayPal for sending and receiving money, plus, linking your bank accounts and more.

Sending and receiving money with PayPal

When making payments online, it’s always good to check that the payment method you’re using is fully secure.

The first thing to know about sending and receiving money with PayPal is that all transactions are monitored 24/7 to help prevent things like identity theft, fraud and email phishing. PayPal also uses what it describes as ‘next-level’ data encryption to protect your money and personal details¹.

Is it safe to pay with PayPal?

There are a few reassuring safety features to know about when sending money with PayPal. Firstly, the recipient doesn’t receive any sensitive or confidential financial information, such as your bank account number or credit card details.

And if you’re using PayPal for online shopping, there’s also PayPal Purchase Protection². This gives you protection if there’s a problem with something you buy, such as a quality issue or a late delivery, where you can open a dispute in the PayPal Resolution Center.

Initially, you can open a dispute in the PayPal Resolution Center and exchange messages with the seller through this portal to try to resolve the issue. But if the dispute can’t be settled this way, you can escalate it to a claim and PayPal will step in to investigate and decide the outcome. If you’re successful in your claim, PayPal will issue a refund.

Is PayPal safe to receive money?

If you’re using PayPal to sell products online, you should be covered by the PayPal Seller Protection Policy³. This covers you in case a buyer claims they didn’t receive an item, or if you’re sent an unauthorised payment (from a hacked account, for example).

Is PayPal.Me safe?

PayPal.Me is a relatively new service offered by PayPal, which helps you to get paid faster using a personalised link. If you’d like to send a payment request to someone, you can create your own custom PayPal.Me link in your PayPal account, then message or email the link to your friend, family member or customer for payment. They don’t need to know your email address or phone number - all they need is the link.

When it comes to safety, PayPal.Me offers all the same security as PayPal provides as standard - including 24/7 anti-fraud monitoring, data encryption and much more. The only difference is that you’re sending out a link to get paid, rather than invoices or your PayPal account details.

Linking PayPal to a bank account

Linking a bank account to your PayPal account can make it quicker and easier to make payments, without needing to dig out card numbers or other personal details. All you’ll need to shop online or send payments is your PayPal login details.

It’s understandable to feel a little nervous when connecting something as important as your bank account to a third party like PayPal. But there’s no need to worry, as PayPal uses extensive security measures to safeguard your bank account. Your account details are never revealed to anyone, and recipients of payments won’t see them.

PayPal’s security experts monitor all accounts for unusual activity, and will investigate on the rare occasion that an unauthorised payment seems to have been sent from your account⁴.

Is PayPal safe for debit cards?

As well as connecting your bank account to PayPal, you can also link a debit card to cover payments and online purchases. The same security protection applies to each, and both can be used as ways of verifying your identity⁵ - which makes PayPal safer to use for everyone.

Is it better to pay with PayPal or credit card?

If you’re shopping online, why would you use PayPal when you have a credit card? This is a common question,but there are a few things to consider when answering it.

The first thing to know is that you can link a credit card to your PayPal account. So, you can pay for things using a credit card, but with the convenience and security of PayPal’s service - where the recipient doesn’t see your credit card details.

However, one of the main benefits of paying for purchases using a credit card is protection under Section 75 of the Consumer Credit Act⁶. This covers you for purchases of £100 or more, if something goes wrong with the transaction or the products/services provided.

Section 75 doesn’t apply if you pay using a third party agent like PayPal. Now, PayPal does offer its own Buyer Protection, but it’s not as comprehensive as Section 75 - nor is it enshrined in law.

It’s useful to bear this in mind and weigh up the pros and cons when considering whether or not to use PayPal or your credit card for certain purchases.

Need to send or receive money in multiple currencies or countries? Wise could help

Of course, PayPal isn’t the only game in town when it comes to making quick, secure online payments - and it’s not always the cheapest for international transfers.

Open a Wise multi-currency account and you can send and receive money worldwide for tiny fees and the real, mid-market exchange rate. Plus, you can hold and manage your money across 50+ currencies.

And Wise takes security extremely seriously. As well as being strictly regulated, Wise uses 2-factor authentication for extra-secure transactions, has a dedicated anti-fraud team and is committed to keeping your personal data safe.

Join Wise today

And that’s pretty much it - all the essentials you need to know about sending and receiving money with PayPal. We’ve covered all the key security measures PayPal uses to keep your money and details safe, so you should be all set to use it with confidence.

Sources used for this article:

  1. PayPal - PayPal safety and security
  2. PayPal - what is PayPal purchase protection
  3. PayPal - PayPal buyer and seller protection
  4. PayPal - why should i link a bank account or a card to my PayPal account
  5. PayPal - how do I verify my PayPal account
  6. Guardian - is a PayPal payment protected

Sources checked on 28-July-2021.

*Please see terms of use and product availability for your region or visit Wise fees and pricing for the most up to date pricing and fee information.

This publication is provided for general information purposes and does not constitute legal, tax or other professional advice from Wise Payments Limited or its subsidiaries and its affiliates, and it is not intended as a substitute for obtaining advice from a financial advisor or any other professional.

We make no representations, warranties or guarantees, whether expressed or implied, that the content in the publication is accurate, complete or up to date.

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