Can I Pay My Credit Card With PayPal?

PayPal is a widely recognized digital payment platform that facilitates online transactions, while a credit card serves as a financial tool for making purchases on credit. When considering the question “Can I pay my credit card with PayPal?”, it can refer to two distinct scenarios. This query often means either attempting to pay down a credit card bill using PayPal, or utilizing a credit card as a funding source for payments made through the PayPal service.

Paying Credit Card Bills Directly

PayPal is not structured as a direct bill payment service for credit card statements. Using a credit card linked to PayPal to pay another credit card bill is not permitted by most credit card issuers or PayPal’s policies. PayPal’s bill pay service restricts using a credit card as the funding source for credit card balances, permitting only debit cards or bank accounts.

Conventional methods for settling credit card balances involve direct engagement with the credit card issuer. These standard payment avenues include initiating an Automated Clearing House (ACH) transfer directly from a linked bank account, submitting a payment through the issuer’s online portal, mailing a physical check, or making a payment using a debit card.

Connecting a Credit Card to PayPal

To utilize a credit card through PayPal for various transactions, the card must first be linked to your PayPal account. This process can be initiated by logging into your PayPal account via their website or mobile application. From the account dashboard, locate the “Wallet” or “Banks and cards” section, then select the option to “Link a card” or “Add new” and specify “Debit or credit card.”

The next step involves providing the necessary card details, including the full credit card number, its expiration date, the three or four-digit CVV (Card Verification Value) security code, and the billing address associated with the card. PayPal may then initiate a small, temporary authorization charge on the card to verify its legitimacy and ownership. You might need to retrieve a unique 4-digit code from your credit card statement or online banking to complete this verification within your PayPal account. An unverified PayPal account can link up to four cards, while a verified account can link up to 24.

Paying with a Connected Credit Card

Once a credit card has been successfully linked and verified within your PayPal account, it becomes an available funding source for various transactions. When making an online purchase, you can select PayPal as the payment method during checkout. After being redirected to the PayPal login page, you will sign in to your account.

Within the PayPal payment interface, you will be presented with a list of your linked payment methods, which includes your newly added credit card. You can then choose this specific credit card to fund the transaction. Similarly, when sending money to another individual via PayPal, you will have the option to select your linked credit card as the preferred funding source for that payment. This functionality allows you to complete transactions without directly entering your credit card information on various merchant websites, adding a layer of security.

Transaction Fees and Processing

Using a linked credit card through PayPal can incur various fees, depending on the nature of the transaction. For personal payments, such as sending money to friends or family within the United States, a fee is applied when a credit card is used as the funding source, often around 2.9% plus a fixed fee of $0.30 per transaction. Conversely, if these personal payments are funded directly from a PayPal balance or linked bank account, they are free.

For business transactions, or when making purchases from merchants, the merchant bears the processing fees. These fees can vary, ranging from 2.29% to 3.49% of the transaction amount, along with an additional fixed fee, between $0.09 and $0.49, depending on factors like the transaction type or sales channel. International transactions may also incur additional percentage-based fees.

When a payment is made, PayPal encrypts the credit card details and transmits them to the issuing bank for authorization. Upon approval, the funds are drawn from the linked credit card and disbursed to the recipient or merchant via PayPal’s secure processing system, with payments processed instantly by PayPal itself.