PUREVPNOnline PrivacyIs PayPal Safe?

What is PayPal? PayPal is one of the most popular and preferred online payment systems for sending and receiving money online. Worldwide, PayPal boasts nearly 300 million active users who rely on the service for online purchases/sales.

Is PayPal safe for sellers?

In a word, yes. PayPal was designed keeping in mind the safety of the sellers as well as the buyers. It’s a secure platform that doesn’t leak your personal information as long as you use it over a secure network. This means that any Information transmitted from your device to PayPal’s server is encrypted.

Fact: PayPal had a low fraud rate of only 0.32% in 2018.

That being said, it is recommended not to use PayPal on a public WiFi network, especially the ones in a restaurant and library. Other users on this public network may be able to sniff your information.

PayPal Seller Protection

Here’s how PayPal protects sellers with its security protocols:

  • Only a user id and password is needed to do transactions. No financial information is transmitted during the process
  • Always-on transaction monitoring is provided by PayPal
  • Advanced encryption techniques and machine learning secures your transactions online
  • Merchant Fraud Protection service helps you to get in touch with PayPal directly if you see a suspicious transaction.
  • You can put a hold on transactions to help resolve disputes
  • PayPal is available in 202 countries

How to protect against scams on PayPal if you’re a seller

Here are a few things you can do as a seller in order to avoid scams, especially if you have to prove to PayPal that you’re a victim of fraud:

  • Use UPS or USPS as your service. These services help your case by providing documentation that you have delivered the item.
  • Use an e-sign for purchases.
  • Have a list of all items you’re selling properly described. Doing so ensures that your customers don’t feel misled.
  • Make customer service your priority. Respond to your customers, and they are less likely to create issues. This process also shows PayPal that you are on top of customer issues.

Is PayPal safe for buyers?

Just like for sellers, PayPal also ensures that buyers are taken care of. As mentioned earlier, transaction data is secure and encrypted for buyers and sellers both.

PayPal buyer protection

PayPal has facilitated buyers with instant, effective, and secure transactions. To accomplish this, they have taken a number of security measures that keep the buyers in mind:

  • No financial information is shared by PayPal with sellers.
  • 24/7 monitoring on transactions.
  • Encrypted security technology for buyers.
  • PayPal’s fraud protection feature allows buyers to flag certain transactions as suspicious.
  • PayPal also puts funds on hold if you have a dispute with a potential fraudster.
  • Supported by many countries worldwide.

What kinds of transactions happen on PayPal?

Essentially, there are two different kinds of transactions that occur over the PayPal platform.

PayPal Friends and Family

As a PayPal user, you can send money to family and friends. You can use this to:

  • pay back loans you owe anyone, 
  • chip together and buy something, 
  • send a gift.

Keep in mind that PayPal charges a small fee on friends and family transactions. This fee can be paid either by the recipient or sender.

In case you use a PayPal Cash or PayPal Cash Plus account to send money, you don’t have to worry about fees while sending a personal payment.

PayPal Goods and Services

If you want to purchase goods and services, be it from a local seller or online retailer, you can do so with PayPal. In this kind of transaction, it is the seller who ends up paying the transaction fee.

How does PayPal refund policy work?

To request a refund from PayPal, there are a couple of things a buyer or seller can do.

Here are a couple of those scenarios to dispute a charge:

  • A transaction has been completed by you and the seller has accepted the payment. In case you need the money back as a refund, the seller can use the PayPal app’s ‘Issue a Refund’ feature.
  • As a buyer, you may have sent money to a seller but they may have not accepted it. If your payment is pending, simply allow 30 or more days to automatically refund your money. Alternatively, check your ‘Activity’ page and use the Cancel button next to your payment. 

Is PayPal a Replacement for Your Bank Account?

In a word, no. This is because PayPal is different from a traditional bank account. It is not intended as a replacement for one.

The balance you have in PayPal is not FDIC-insured. In simple terms, an FDIC-insured bank account protects you from losses up to $250,000. While PayPal has explored ways to offer a degree of protection to its users, it still falls short of FDIC rules.

PayPal Safety: Key Takeaways

PayPal helps buyers and sellers do transactions securely and conveniently. However, make sure you keep these things in mind to use PayPal safely: 

  • Sellers are assured of an optimum experience, thanks to safety protocols for fraud protection, financial data encryption, and 24/7 transaction monitoring.
  • Use a service like UPS or USPS
  • Get a signature from buyers
  • Explain your products clearly, and ensure superior customer service.
  • As a buyer, use a credit card preferably whenever you can.
  • Use strong passwords
  • Keep your PayPal app updated to enjoy the latest security features.
  • Avoid public WiFi for PayPal transactions.
  • Make use of dispute payments or cancel transactions in case anything goes wrong.

PayPal security: Tips to secure your account

Buyers and sellers on PayPal should do these things to secure their accounts against malicious third-parties.

Enable two-factor authentication

With 2FA authentication, your account gets an unprecedented layer of security. It is not enabled by default, so make sure you turn it on.

To do this:

  • Login to your PayPal account
  • Go to Settings > Security > 2-step verification
  • Follow the steps to setup either a 2FA app (like Google Authenticator) or your mobile number.

Use Credit Card as a first resort

Instead of using your debit card or bank account, consider using a credit car for purchases.

This is important because using a credit card all but eliminates the possibility of the other party using PayPal’s auto-withdrawal feature to clean out your bank account. Furthermore, a fraudulent charge can be disputed and reversed easily with your credit card company.

Update your PayPal App

With new threats and security holes being discovered all the time, it is important to use the latest version of PayPal on your device to protect your transactions. Updates almost always fix security vulnerabilities faster than ever.


How to add money to your PayPal account?

With PayPal, you can simply link up your credit card, debit card or bank account. You can then use the available balance on those sources of funds on PayPal. No need to add money to your PayPal account.

Who is the owner behind PayPal?

eBay was once the owner of PayPal Inc. However, PayPal became its own separate entity later on. PayPal is currently listed on NASDAQ under PYPL.

Can you buy bitcoin with PayPal?

Yes, you can. Simply navigate to the ‘crypto’ section on PayPal app or website. There, you can buy digital assets such as Ethereum, Litecoin or bitcoin. Please note that PayPal will draw funds from your linked payment methods to purchase the digital commodities.

What are PayPal’s charges?

If you are buying something from a business, you most likely won’t need to pay any fees.

For sellers, PayPal charges a fee.

It also charges a fee on personal transfers between two people, international transactions, and funds remitted from a debit or prepaid card to a bank account.

Topics :




June 20, 2023


12 months ago

PureVPN is a leading VPN service provider that excels in providing easy solutions for online privacy and security. With 6000+ servers in 65+ countries, It helps consumers and businesses in keeping their online identity secured.

Have Your Say!!

Join 3 million+ users to embrace internet freedom

Signup for PureVPN to get complete online security and privacy with a hidden IP address and encrypted internet traffic.