Is PayPal Safe?

Are you thinking about opening a PayPal account? Have you read a bit about them here and there and maybe heard some things about scams and now you’re wondering whether they are safe? Plenty of people worry about the same thing before they open an account and that is why we’ve compiled some reviews and ratings for PayPal from a handful of sources so that you can make an informed decision.

About PayPal Bank

PayPal offers a range of services as well as a handful of different financial accounts. PayPal allows you to use your bank account or the money sitting in your PayPal balance to make purchases or transfer money. If you do this domestically there is no fee. You can also transfer money directly to a debit card, a credit card, or the PayPal credit for a limited fee.

According to Consumer Affairs, PayPal was founded back in 1998 but acquired by eBay in 2002. Today they operate in over 200 countries, 25 currencies, handling over 5 billion transactions for its 200 million active clients. Consumers can use PayPal for online payments, credit financing, the easy app, setting up recurring payments for subscriptions, without the fees that you would get from other banks or online services.

Services Offered by PayPal

PayPal is very well regarded by NerdWallet for things like the cashback opportunities especially with the MasterCard, the ease of the PayPal account and the top-of-the-line mobile applications and website that allow you to do a litany of financial things not just buying and selling but sending invoices.

PayPal Account

The first is the PayPal account. For this service you link your bank account wherever you might bank locally to the PayPal account. You can then connect things like your banking debit card, your savings account, or your checking account and use them to send money back and forth between PayPal and your bank account. Money held in PayPal can be used to more securely make purchases online without revealing sensitive data like a bank account or credit card numbers.

Even if you don’t have adequate funds in your PayPal cash account, you can set it up to automatically pull from something like a checking account, savings account, or credit card as a backup.

PayPal Mastercard

Linked to your Paypal account you can use the PayPal Mastercard. This is a debit card that functions the same as any other debit card that you might have for a regular checking account. You can use it to withdraw cash or check your account balance without fees so long as you do it domestically. This is significantly more appealing than most banks which charge you for every account balance inquiry or withdrawal at an ATM that isn’t theirs.

You can spend on this card physically using it the same as you would to swipe for a purchase or online the same as you would putting in the card numbers. This is a great way to use the card online without revealing your bank account especially if the company doesn’t use PayPal directly. The PayPal Mastercard earns you cash back rewards as well very similar to other cards.

PayPal Credit

Consumers have the option of using a PayPal credit line. This is not a physical credit card and it can only be used in situations where the online Merchant already accepts PayPal as a payment method. In these situations you can charge it to your credit line, a credit line that typically offers 0% interest on each purchase above a minimum amount so long as it is paid back within six months. 

Customer Service Reviews

When it comes to customer service, reviews are mostly positive. For most matters such as fraudulent charges or being overcharged for something, customer service is very fast and uses the secure communication portal within the PayPal account for each consumer. Issues for fraud are dealt with swiftly by the fraud department. 

As one user said, “I ordered jewelry in November 2019 for my family for Christmas and when it did not arrive and I was getting the run around from Glencara I had to buy more jewelry to replace it. Everything was purchased through Paypal. I contacted Paypal on 30th December 2019 and they upheld my complaint. Within a couple of days my money had been refunded in full and transferred to my bank account. I cannot speak more highly of Paypal I have always had a good experience with them.”

Customer Complaints About PayPal

Consumer Affairs has given them an average of 2.5 out of 5 stars to do mostly with the balance between positive reviews, five star reviews from people who had perfect service when things get went wrong, all the way down to the opposite end of the spectrum where people had abhorrent situations with abysmal outcomes when things went wrong.

People who had issues with things like fraudulent charges to their account found that customer service was readily available through a handful of contact methods and were very quickly able to reverse the problem and credit the account. The downside though is when things have to do with eBay.

PayPal Scams

PayPal scams happen usually via email or online purchases, and sometimes it’s people fraudulently asking for donations so you end up donating and then having money drained from your PayPal account, or they have to do with things like eBay purchases.

The link between eBay and PayPal is historic and in large part what led PayPal to become what it is today but unfortunately there are a lot of fraudulent cases where someone might try to purchase on eBay and then claim they never received the item or claim the item was damaged, and other cases where consumers purchase something from overseas and what they get is vastly different than what was advertised. Consumers who had very bad experiences with PayPal report similarities between PayPal fraudulent activity and eBay. PayPal tends to side with the buyer more often than not so even if something does arrive damaged or completely different than what was expected, it will be hard to get the money back. 

What to do if you have a complaint

If you have a complaint against PayPal, and you aren’t getting a solution to your problem, we can help.