Does PayPal charge interest
PayPal does not charge interest on standard payments, transfers or checkouts, but it does charge interest on some of its credit and financing products.
For everyday use, costs come as fees rather than interest.
- Standard transactions: Sending and receiving money, regular purchases and bank transfers carry no interest.
- Fees instead of interest: PayPal charges percentage fees, fixed fees or a currency conversion markup on certain transactions. It does not charge a fee to open an account or download the app.
Interest becomes relevant when you use PayPal's credit options, which are separate from a normal account.
- PayPal Credit: In the US, purchases of $149 or more can qualify for no interest if paid in full within 6 months. If the balance is not cleared by then, deferred interest is added back from the original purchase date.
- Carrying a balance: Interest is charged when you keep a balance on a PayPal credit service beyond a promotional period.
- Pay Monthly: This installment product requires you to be at least 18, hold a PayPal account in good standing and apply for a Pay Monthly plan. Purchase APRs across PayPal credit and installment products typically fall around 29% to 35%, depending on the product.
To avoid interest on financed purchases, track the end date of any promotional period and pay the full amount before it ends. For transaction costs on regular payments, review PayPal pricing for your country, since fees vary by transaction type and currency.
Credit products and their terms differ by country, and the promotional offers described here apply to PayPal in the US.