How to Change Default Payment Method on PayPal

If you have a PayPal account for business or personal use, you’ll know that it’s possible to save and use multiple payment methods. But it’s not always straightforward to know which one will be used by default.

This guide explains how to change your preferred payment method for PayPal on desktop and mobile, and understand how your choice can affect international transactions.

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What does ‘default payment method’ mean on PayPal?

PayPal uses the term ‘preferred payment method’ when talking about a default payment method. This is the card or bank account PayPal will generally try to use first when you make purchases or send money.

However, it isn’t necessarily used for every single transaction, and it may not override balances, backup methods or merchant-specific automatic payments (like subscriptions and billing agreements).

Preferred payment method vs. default payment method

On PayPal, ‘default payment method’ and ‘preferred payment method’ mean the same thing. It’s just that you’ll see ‘preferred’ used within your PayPal Wallet settings.

When PayPal may still use your balance first

It’s important to note that PayPal always uses the available funds in your PayPal balance first, ahead of a default card or bank account.¹

The default priority order it uses goes like this:¹

1. Balance
2. Bank account (if one has been added)
3. PayPal Credit (if applicable)
4. Card (if a card has been linked)
5. eCheque.

PayPal works its way through this list. If one option is unavailable (for example, you don’t have any funds in your balance or you haven’t added a bank account) it will move onto the next, in priority order.

Why some payments use a backup method

PayPal may switch to a backup payment method if your selected or preferred payment method isn’t available. For example, if your preferred card is declined, has expired, lacks sufficient funds or cannot be authorised for another reason.

How to change your preferred payment method on PayPal desktop

To change your preferred payment method on PayPal via desktop, you'll first need to ensure the card or bank account has already been added to your PayPal account.

Once it's available in your Wallet, you can choose it as your preferred payment option. Read on for how to change your payment method on PayPal online, in a few simple steps.

Step 1: Go to your PayPal Wallet

Sign in to your PayPal account (or create a new one if you’re not already signed up) from your web browser. Open ‘Wallet’ from the main navigation menu, and you’ll be able to see all saved cards and linked bank accounts.

If you’re adjusting the settings for a business account, you may need to go to ‘Money’ and then ‘Payment Preferences’.

Step 2: Select the card or bank account you want to use

Choose the payment method you'd like PayPal to prioritise for future eligible payments.

If you haven't yet linked the card or bank account, you'll need to add and verify it before it can be selected.

Step 3: Set it as preferred

Open the payment method's details and select ‘Set as preferred’.

Once saved, PayPal will normally use this funding source for eligible future transactions unless another payment rule takes precedence.

How to change your preferred payment method in the PayPal app

The process of changing your preferred payment type is similar on both PayPal desktop and the PayPal app. Bear in mind though that menu names and layouts may vary slightly between Android and iPhone, as well as between different account types.

Step 1: Find Wallet in the PayPal app

Open the PayPal app and tap ‘Wallet’, where you'll find your linked cards, bank accounts and available PayPal balance.

Step 2: Choose a card or bank account

Open the PayPal app and tap Wallet, where you'll find your linked cards, bank accounts and available PayPal balance.

Step 3: Check the change before your next payment

Before making another payment, it’s worth taking a moment to double-check that your chosen card or bank account is now showing as your preferred funding source. This can help avoid unexpected payment methods being used.

How to change the payment method for PayPal automatic payments

Subscriptions, billing agreements and saved merchant payments can use their own payment methods - even if you’ve set a different preferred payment method.

This is because the merchant may have their own preferred methods. For example, a software subscription provider may only accept card payments, not bank transfers.

What counts as an automatic payment?

PayPal automatic payments typically include:

• Subscription services
• Recurring memberships
• Merchant billing agreements
• Saved business payment authorisations
• Any payment you've authorised PayPal to process automatically.

Why changing your preferred method may not affect subscriptions

When you change your preferred payment method, it’s important to remember that this doesn’t automatically update it for PayPal automatic payments.

This is because each automatic payment is linked to a specific payment method - selected when the agreement was first created.²

Updating payment methods for individual merchants

To change a payment method for an individual merchant, follow these steps:²

1. Go to ‘Settings’
2. Select ‘Payments’
3. Select ‘Automatic Payments’ or ‘Subscriptions and saved businesses’
4. Choose the merchant
5. Select ‘Change Payment Method’
6. Select a new saved payment method, or add a new card or bank account
7. Check the details carefully and then click ‘Save’.

How to choose a different PayPal payment method at checkout

You can also choose a payment method at checkout when making a purchase. For example, if you want to use a different card for a particular purchase.

Using ‘Change’ at checkout

During checkout, PayPal will often display your selected payment method along with a Change option before you confirm payment.

Choosing a one-time payment method

Selecting ‘Change’ at checkout allows you to choose another linked card, bank account or other available funding source just for this one-time purchase. It won’t change your overall default payment method.

Reviewing the selected method before confirming payment

Before confirming the transaction, it’s worth double-checking that the payment method you want to use is displayed on the final review screen. This is particularly important for larger purchases and international payments.

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What to check before changing your PayPal payment method

It’s a good idea to make a few quick checks before changing your default payment method on PayPal. This can prevent issues like declined payments or interruptions to recurring billing.

Check whether your new card or bank account is confirmed

If you’ve added a new card or bank account to your PayPal account, make sure it has been successfully added, verified and confirmed before you set it as your preferred payment method.

Review backup payment methods

Check whether any subscriptions or merchants require you to add a backup payment method. This could be very useful if your preferred card is declined for any reason.

Check subscriptions before cancelling an old card

Before removing or cancelling an old card, review any active subscriptions and automatic payments to make sure they're linked to a new or alternative payment method.

It's also worth checking for pending payments or payment holds that may still rely on your existing funding source.

International payments and currency conversion on PayPal

Changing your preferred payment method affects which funding source PayPal attempts to use, but it doesn't remove any PayPal international payment fees or currency conversion costs that may apply.

How payment method choice can affect international costs

Different cards or bank accounts may charge different foreign transaction fees, while PayPal may apply separate cross-border charges depending on the payment.

So, choosing a different payment method can potentially affect the overall cost of PayPal international payments.

PayPal currency conversion and exchange rate markups

If a payment requires currency conversion, PayPal will apply its own exchange rate. This can include a markup above the wholesale market rate.

Why reviewing fees matters before sending money abroad

Before sending money abroad, it’s recommended to check PayPal international payment fees carefully - as well as PayPal’s currency conversion costs. It’s important to understand the true total cost of each transfer, especially if you’re sending large amounts or making regular payments.

Wise as an alternative for international payments

While you’re reviewing the costs of sending money overseas, it’s worth shopping around to compare fees and exchange rates between providers.

This is where Wise comes in. As an international money transfer specialist, it’s a useful alternative for people or businesses sending money internationally, paying overseas suppliers or managing multiple currencies.

Sending money abroad with transparent fees

With Wise and Wise Business, you can send money to 140+ countries for transparent fees, with no hidden costs. Even better, you’re guaranteed mid-market exchange rateswith no expensive markup.

Managing international payments in multiple currencies

A particularly attractive feature of Wise Business for companies, sole traders and freelancers is the ability to hold and manage funds in 40+ currencies all from one account. This makes it easier to pay suppliers and work with customers in different countries.

When to compare Wise and PayPal before paying

If you're making international business payments, comparing Wise Business and PayPal before sending money could be worth your while - and it could potentially save you money.

It’s also worth comparing Wise and PayPal as a personal customer, just in case you can save money.

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Make the wise choice when selecting a business account for your domestic and global needs.

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**Investments are not guaranteed, and your capital is at risk.

Wise is an Electronic Money Institution (EMI), so features like Interest and Stocks may be covered by the Financial Services Compensation Scheme (FSCS). For standard cash balances, we safeguard your funds to meet regulatory obligations.

In the UK, Interest and Stocks are provided by Wise Assets, the trading name of Wise Assets UK Ltd, which is authorised and regulated by the Financial Conduct Authority (FCA number 839689).

We do not provide investment advice, and taxes may apply. If unsure, seek qualified financial advice. Full fund information is available on our website.

FAQs

Can I change a PayPal payment method after sending money?

No. Once a payment has been authorised and completed, you generally can't change the funding source used for that transaction. You can only update the payment method for future payments.

Does PayPal charge a fee to change my preferred payment method?

No. Changing your preferred payment method within your PayPal account is free. However, normal transaction fees, currency conversion charges or card issuer fees may still apply when you make payments.

Can I set different preferred payment methods for shopping and sending money?

In some cases, PayPal may allow different payment preferences depending on the transaction type. However, many payments still follow your account's preferred funding source unless a merchant-specific or automatic payment setting overrides it.

Why did PayPal use my backup card instead of my preferred card?

PayPal may use your backup payment method if your preferred card is declined, unavailable, expired, has insufficient funds or cannot be authorised. Certain recurring payments and merchant agreements may also use their own assigned payment method.

Can I remove a card after setting a new preferred payment method?

Yes. Once you've confirmed another eligible payment method is set as preferred (and you've updated any subscriptions or recurring payments) you can remove the old card from your PayPal Wallet.

Does changing my PayPal payment method affect refunds?

No. Refunds are generally returned to the original payment method used for the transaction where possible, even if you've since changed your preferred payment method. The exact destination of a refund may depend on the status of the original card or bank account.

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Sources used:

1. PayPal - Help - What payment methods can I use with PayPal?
2. PayPal - Help - What is an automatic payment and how do I update or cancel one?

Sources last checked: 07-Jul-2026