PayPal has a range of options for making and receiving payments whether you’re looking to pay back a friend, or bill a customer. PayPal Request Money is one way to request a payment. And you can use it via email or SMS.
The service can be handy — but you need to understand the fees involved. If you’re asking for payments for goods or services, and especially if you’re working globally and expecting a payment from someone based overseas, then these charges can stack up quickly. You could find there’s a better deal out there with a specialist in international payments like Wise.
To help you decide if PayPal Request Money is the right route for you, here’s a handy guide to how it works — and what it’ll cost you.
With PayPal Request Money, you can send an email or SMS to ask for a payment. The recipient will receive either an email or message with a link, through which they can make a payment directly to your PayPal wallet¹. You can add a note and explanation to your request, and use it for either personal or work use — although different fees apply for business transactions².
With a PayPal invoice, the sender can add much more detail and customization compared with a PayPal money request. An invoice might be more useful if you need to provide an itemized statement of work done,³ for example. While a money request is sufficient for personal use or if the business payment is straightforward to describe.
However, both options allow the sender to be paid directly into their PayPal wallet.
PayPal money requests can be sent to people who do not have a PayPal account. You may then be able to get your payment offline, as a check, for example. If you want to receive payment via PayPal, though, the person you’re requesting might have to open a PayPal account themselves, if they don’t have one yet, depending on the way they want to pay for the request.⁴
To use PayPal Me, either to send a link asking for money or to make a payment, you must have a PayPal account. It’s not really designed for offline payments. There may also be slight differences in the fees charged if you’re requesting or sending money abroad, depending on the exact nature of the transaction.⁵
If you’re using PayPal to request money for a business payment, then you might be covered by buyer or seller protection. This only applies to eligible transactions, and there are some purchases which are excluded.²⁺⁶
If you’re a buyer, and are sent a PayPal Money Request, it’s worth checking that the reason for and description of the payment are detailed enough. This can help you if there’s a dispute. For example, if you receive goods which don’t match the description you agreed, having this detailed in the Money Request will act in your favor and help to prove that you weren’t treated fairly.
If you’re planning on using PayPal Request Money, you’ll want to get familiar with the fee structure. There are different charges depending on the type of payment, and where in the world the money is going to. Here’s an overview.
To send money to friends and family who have a PayPal account in the US or Canada, you’ll pay the following:
- Payments funded by PayPal balance, or a linked bank account — no fee
- Payments partly or fully funded by credit or debit card, or PayPal Credit — 2.9% of the total transaction amount + a fixed fee if relevant, based on the currency being used
The fixed fees are relatively low amounts and are added to transactions carried out in different currencies.⁷
If you have a US PayPal account and are being paid by a customer who also has a US PayPal account, then the fee is 2.9% of the total payment amount⁷ + $0.30.
If you pay for a request money from friends and family outside of the US, there will be a fee to pay, which could be covered by the person sending the money, or removed from the transferred amount before it reaches your PayPal wallet. The fee that you have to pay also depends on where your recipient is located, but are as follows:
- Payments funded by your PayPal balance, or a linked bank account — $2.99 when they’re located in Canada or Europe, and $4.99 for any other country.⁷
- Payments partly or fully funded by credit or debit card, or PayPal Credit — $2.99 + 2.9% of the amount of the payment when they’re located in Canada or Europe, and $4.99 + 2.9% of the payment amount when they’re located in any other country. For all countries there will be an additional fixed fee which depends on the currency.⁷
- Paypal also notes that if you pay in a foreign currency, the fee will be the equivalent to the US dollar fee, but in that currency. PayPal also notes that they add their own currency conversion spread which is an additional cost.⁷
The fixed fees are detailed in the link below. You should also know that PayPal notes that they add a markup to the exchange rate they use when calculating an international payment. When this happens, you likely won’t get the real exchange rate. Instead, PayPal take an extra slice of profit, and you end up with less in your pocket at the end of the transaction.
While PayPal can be a great service to shop online or send money to friends domestically, it’s not always the best choice for international payments. You could be better off if you choose a specialist in international money transfer, like Wise, to make a transfer using the real exchange rate, and with only a single, small, up front fee to pay.
If you’re requesting payment from a customer based abroad, the fee will be higher than for a domestic commercial payment.⁷⁺⁸ You can easily calculate how much will PayPal charge you for domestic or international transactions with this PayPal fee calculator.
For an online sale you can expect a fee of 4.4% of the transaction amount + a fixed fee based on the currency used.⁸ You’ll also have to watch out for the exchange rate used, as a currency spread might be added, which can increase the costs by around 2.5%.
If you deal with clients from overseas regularly, or are planning to grow your business to take in international customers, you could be much better off if you choose an alternative payment method to PayPal.
Try a specialist in international payments like Wise to see if you can get a better deal. This is especially useful for business owners, as Wise doesn’t add any extra fees for international transfers made for business purposes. That can save you a bundle. In fact, independent research found that you could save 9x on the same transaction, if you use Wise to make or take international payments for your business rather than PayPal.
If you send a PayPal money request, then the fee depends on the method of payment, and whether the person paying has a PayPal account in the US or not. It’s free for a friend in the US to send you a payment funded by their own PayPal balance, or their linked bank account. Otherwise, there will be a fee to pay for the transaction.
Requesting money on PayPal is easy. Simply log into your PayPal account, and click on the ‘send and request money’ button. From here you can follow the steps, clicking request money, and entering the email address or mobile number of the person you want to request money from.⁹
You can request money from multiple people at the same time, simply by adding in additional email addresses or phone numbers. You'll then have to specify whether you’re looking to split a bill, and therefore have everyone contribute towards a set total amount, or make a basic request in which everyone is asked to pay the same fixed amount.⁹
If you want to send unique requests to multiple recipients — rather than asking everyone to equally split a single bill, for example — you'll need to create separate money requests for each individual.
Once your money request has been paid, you’ll get an email, and the status of the payment will be updated in your PayPal account. The money will appear in your balance, and you can either spend it or withdraw it to your linked bank account.¹⁰
- PayPal: International Business Payments True Cost
- PayPal: Business Accounts
- PayPal: Invoicing Guide
- PayPal. Paying International Invoices Guide
- PayPal: Exchange Rates and Currency Conversion
- PayPal: International Fees (US)
- PayPal: International Fees (UK)
- PayPal: International Money Transfer Guide
- PayPal: Get Paid
- PayPal: 15 Alternatives
PayPal can be a fantastic way to shop online, and send or request cash from friends and family living locally. However, if you’re running a business, or need to get money from someone based overseas — either for work or pleasure — you need to be aware of the fees that will be applied.
You might find you’re better off with a different method of payment, especially if you’re dealing with payments from overseas. Try a specialist in international money transfers like Wise to see if you could save yourself some money.
¹https://www.paypal.com/us/selfhelp/article/request-money-faq764 (June 8, 2018)
²https://www.paypal.com/us/webapps/mpp/requesting-payments (June 8, 2018)
³https://www.paypal.com/us/webapps/mpp/mobile-apps/business-app (June 8, 2018)
⁴https://www.paypal.com/us/selfhelp/article/how-do-i-pay-for-a-payment-request-or-invoice-faq2206 (June 8, 2018)
⁵https://www.paypal.com/paypalme/pages/faqs (June 8, 2018)
⁶https://www.paypal.com/us/webapps/mpp/paypal-safety-and-security (June 8, 2018)
⁷https://www.paypal.com/us/webapps/mpp/paypal-fees (June 8, 2018)
⁸https://www.paypal.com/us/webapps/mpp/merchant-fees (June 8, 2018)
⁹https://www.paypal.com/us/selfhelp/article/how-do-i-request-payments-or-send-an-invoice-faq2155/11 (June 8, 2018)
¹⁰https://www.paypal.com/us/selfhelp/article/how-do-i-know-if-my-money-request-or-invoice-has-been-paid-faq763/16 (June 8, 2018)
This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from TransferWise Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.
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