PayPal charges a fee when you send money using a credit card, but not when you use a debit card or bank account
If you link a credit card to PayPal and use it to send money to another person, PayPal charges you a fee. The fee is a percentage of the amount you send, plus a flat amount per transaction. If you use a debit card or bank account instead, you pay nothing for personal transfers.
The fee structure depends on whether you are sending money domestically (within the US) or internationally. Domestic credit card transfers cost more than international ones in percentage terms, though the flat fee is the same. PayPal does not charge a fee when someone sends you money — the sender pays, not the receiver.
The reason PayPal charges this fee is that credit card companies charge PayPal a processing fee every time a credit card is used. PayPal passes that cost to you. Debit cards and bank accounts have lower processing costs, so PayPal does not charge you to use them.
Key Takeaways
- Sending money via PayPal with a credit card costs a percentage fee plus a flat fee per transaction; using a debit card or bank account costs nothing for personal transfers.
- Domestic credit card transfers have a higher percentage fee than international transfers, though both include the same flat fee.
- The fee applies only to the person sending the money, not the person receiving it.
- Business transactions and goods-and-services payments have different fee structures than personal money transfers.
- You can check the exact fee before you confirm the transfer, so you know the total cost before your money leaves.
Domestic credit card transfers and their cost
When you send money within the United States using a credit card, PayPal charges 2.2% of the amount plus $0.30 per transaction. This means a $100 transfer costs $2.50 in fees. A $500 transfer costs $11.30. The percentage applies to the full amount you send, not just the portion above a minimum.
PayPal shows you this fee on the screen before you confirm the transfer. You see the amount you are sending, the fee amount, and the total that will be deducted from your credit card. You can cancel at this point if the fee is higher than you expected.
This fee applies only to personal transfers — money you send to a friend or family member. If you are paying for goods or services through PayPal, the fee structure is different and typically lower.
International credit card transfers and their cost
Sending money to someone outside the United States costs less as a percentage but includes an additional currency conversion fee. The credit card fee for international transfers is 1.5% plus $0.30 per transaction. However, PayPal also charges a currency conversion fee on top of this, which varies depending on the country you are sending to and the currency involved.
The currency conversion fee is not a fixed percentage — it changes based on the exchange rate and PayPal's markup at the time of transfer. You will see the total cost, including both the transfer fee and the conversion fee, before you confirm the transaction.
If you are sending money internationally regularly, comparing PayPal's rate to other services like Wise or OFX may save you money, since those services sometimes offer better exchange rates for larger amounts.
Why credit cards cost more than other payment methods
Credit card companies charge PayPal a processing fee every time a credit card is used. This fee, called an interchange fee, typically ranges from 2% to 3% of the transaction amount. PayPal passes this cost to you as the credit card fee you see.
Debit cards have lower interchange fees — usually around 0.05% to 0.25%. Bank accounts have even lower processing costs because they move money directly between financial institutions without a card network involved. Since PayPal's cost is lower when you use these methods, they do not charge you a fee for personal transfers.
This is why PayPal always recommends using a debit card or bank account for personal transfers. You save money, and PayPal saves money on processing costs.
How to avoid credit card fees on PayPal
The simplest way to avoid the fee is to link a debit card or bank account to your PayPal account and use that for transfers instead. The process takes a few minutes: go to your PayPal wallet, select "Link a card or bank," and follow the prompts to add your debit card or checking account information.
Once your debit card or bank account is linked, you can choose it as your payment method when you send money. PayPal will ask which payment method you want to use — select your debit card or bank account, and the fee will not explore.
If you only have a credit card available, you have two options: pay the fee, or ask the person you are sending money to to request the funds from you instead. When someone requests money from you through PayPal, you can pay that request using a credit card without a fee. This is a workaround, but it only works if the other person has a PayPal account and is willing to initiate the request.
Credit card fees for goods and services payments
If you are using PayPal to pay for something you bought — not sending money to a person — the fee structure is different. PayPal does not charge you a fee to pay for goods or services with a credit card. The seller pays a fee to PayPal for receiving the payment, not you.
This is why you can use a credit card to pay for items on eBay, Etsy, or other sites that accept PayPal without seeing a fee added to your purchase. The merchant absorbs that cost as part of doing business.
The distinction matters: personal money transfers to friends and family trigger the credit card fee. Payments for goods and services do not.
What happens if you do not have a debit card or bank account
If your only payment method is a credit card, you will pay the fee every time you send money through PayPal. There is no way around it in this situation. Your options are to accept the fee, use a different money transfer service, or ask the recipient to request the funds from you instead (if they have a PayPal account).
Some people in this situation choose to use a different service like Venmo, Square Cash, or Zelle, which may have different fee structures or no fees at all for certain types of transfers. However, those services also have their own rules about which payment methods trigger fees.
If you are planning to send money regularly, opening a basic checking account at a bank or credit union is usually worth the effort. You can then link that account to PayPal and avoid fees entirely on personal transfers.
Frequently Asked Questions
Does PayPal charge a fee if someone sends me money with a credit card?
No. The person sending the money pays the fee, not the person receiving it. You receive the full amount they sent, and PayPal does not deduct anything from your account.
Can I dispute a PayPal credit card fee?
PayPal does not refund fees for personal transfers made with a credit card, since the fee is disclosed before you confirm the transaction. If you believe you were charged in error — for example, if you used a debit card but were charged the credit card fee — you can contact PayPal support to review the transaction.
Is the PayPal credit card fee the same every time?
The percentage and flat fee amounts stay the same, but the total fee changes based on how much money you send. A larger transfer means a larger fee. PayPal may also change these rates over time, though they typically announce changes in advance.
What if I use a credit card linked to my bank account?
If your credit card is issued by your bank but is a separate account from your checking account, PayPal treats it as a credit card and charges the fee. Only debit cards and direct bank account links avoid the fee. If you are unsure whether your card is a debit or credit card, check your bank statement or card itself — debit cards say "debit" on the front.
Do I pay the credit card fee if I request money from someone?
No. When you request money from another PayPal user, they pay the fee if they use a credit card to fulfill the request. You do not pay anything to request the money.