Yes, you can send money through PayPal with a credit card, but PayPal treats it differently than a bank transfer
PayPal lets you link a credit card to your account and use it to send money to other people. However, PayPal charges a fee for credit card transfers that it does not charge for bank transfers. The fee is 2.2% of the amount you send, plus a flat $0.30 per transaction in the United States. This means sending $100 costs $2.50 in fees.
The person receiving the money gets it in their PayPal account, not directly to their bank. If they want the cash in their bank account, they have to withdraw it separately, which may take one to three business days depending on their bank.
Credit card transfers through PayPal are useful when you do not have a bank account linked, when you want to earn credit card rewards on the transfer, or when you need to send money quickly. They are not useful if you are trying to avoid fees or if you need the recipient to have cash immediately.
Key Takeaways
- PayPal charges 2.2% plus $0.30 to send money using a credit card, but charges nothing for transfers from a linked bank account.
- The recipient receives money in their PayPal account, not their bank account, unless they withdraw it themselves.
- Credit card transfers work if your bank account is not linked or if you want to earn rewards, but cost more than other methods.
- Some credit cards offer cash back or points on PayPal transfers, which can offset part of the fee depending on your card's rewards rate.
- The transfer appears in the recipient's PayPal account within minutes, but converting it to bank cash takes one to three business days.
How to set up a credit card on your PayPal account
Log into PayPal on a web browser or the mobile app. Go to your Wallet (on the app, tap the wallet icon at the bottom). Select "Link a card or bank" and choose "Link a card". Enter your credit card number, expiration date, CVV, and billing address. PayPal will verify the card by charging a small amount (usually $1.95) and then refunding it within a few days. You can use this card immediately after you link it.
If you already have a card linked, you can use it to send money without setting it up again. Go to the "Send money" tab, enter the recipient's email or phone number, type the amount, and select your credit card as the payment method before you confirm.
When credit card transfers make sense financially
A credit card transfer only saves you money if your card's rewards rate is higher than the 2.2% plus $0.30 fee. For example, if your card gives 2% cash back on all purchases, you break even on a $100 transfer (you pay $2.50 in fees but earn $2 in cash back, for a net cost of $0.50). If your card gives 3% cash back, you actually come out $0.50 ahead.
Cards that offer bonus categories can make this work better. Some cards give 3% cash back on online purchases, which includes PayPal transfers. Others offer 5% back on rotating categories that sometimes include digital payments. Check your card's rewards terms to see whether PayPal transfers count as a bonus category.
The math changes if you are sending a small amount. Sending $20 costs $0.74 in fees. Even a 3% cash back card only earns you $0.60, leaving you with a net cost of $0.14. For small transfers, a bank account link is almost always cheaper.
Credit card transfers versus other PayPal payment methods
| Payment Method | Fee | Time to Recipient's Account | Best For |
|---|---|---|---|
| Linked bank account | None | 1–3 business days | Saving money when you have a bank account |
| Credit card | 2.2% + $0.30 | Minutes | Earning rewards or when bank account is not linked |
| PayPal balance | None | Minutes | Sending money you already have in PayPal |
| Debit card | 2.2% + $0.30 | Minutes | Same as credit card, but no rewards |
If you have a PayPal balance (money sitting in your PayPal account from a previous transfer or sale), sending from that balance costs nothing and arrives in minutes. This is the cheapest option if it is available to you. If you do not have a balance and do not want to pay fees, linking a bank account is the standard choice.
What happens to the money on the recipient's end
When you send money through PayPal using a credit card, the recipient sees it arrive in their PayPal account within minutes. They do not automatically receive it in their bank account. If they want cash, they have to go to their PayPal wallet and select "Transfer to your bank" or "Withdraw". This withdrawal usually takes one to three business days, depending on their bank.
Some recipients may not realize they need to take this extra step and may think the money is stuck in PayPal. You can let them know upfront that they will need to withdraw it to their bank if they want it as cash. If they have a PayPal debit card, they can also spend the money directly from their PayPal balance without withdrawing it.
Limits on how much you can send with a credit card
PayPal sets sending limits based on your account history and verification status. New accounts typically have lower limits than established ones. A newly verified account might be able to send $500 to $2,000 per transaction, while an older account with a good history might send $5,000 or more. PayPal does not publish exact limits publicly because they vary by account.
If you hit your limit, you can request an increase through your account settings. PayPal reviews the request and usually responds within a few days. Linking a bank account and keeping your account in good standing (no disputes or chargebacks) helps you build higher limits over time.
Security and fraud protection when using a credit card
Your credit card's fraud protection applies to PayPal transfers. If someone uses your card without permission through PayPal, you can dispute the charge with your credit card company just as you would any other unauthorized purchase. PayPal also has its own dispute process if the recipient claims they never received the money or if there is a problem with the transaction.
PayPal requires you to verify your identity before you can send large amounts or change your payment method. This usually means confirming your email address and phone number. If you are sending money to someone you do not know, PayPal may ask additional questions or hold the transfer for review.
Frequently Asked Questions
Does PayPal charge a fee if I use a credit card to send money to friends?
Yes. PayPal charges 2.2% of the amount plus $0.30 for any credit card transfer, whether the recipient is a friend or a business. Bank account transfers are free. The only way to avoid the fee is to send from your PayPal balance or link a bank account instead.
Can I earn credit card rewards on PayPal transfers?
Yes, if your card treats PayPal transfers as a purchase. Most cards do, but some exclude money transfers from their rewards categories. Check your card's terms or call the issuer to confirm. Even if you earn rewards, the fee (2.2% + $0.30) may be higher than the rewards you get back on small amounts.
How long does it take for money sent via credit card to show up?
The money appears in the recipient's PayPal account within minutes. However, if they want it in their bank account, they have to withdraw it, which takes one to three business days depending on their bank. The credit card transfer itself is instant, but the full process to cash can take several days.
What if I do not have a bank account linked to PayPal?
You can still send money using a credit card or debit card. You will pay the 2.2% plus $0.30 fee, but the transfer will go through. Linking a bank account later will let you send money for free on future transfers.
Is it safer to send money with a credit card or a bank account through PayPal?
Both are protected by PayPal's dispute process. Your credit card also has its own fraud protection. A credit card may be slightly safer because you can dispute the charge with your card company if something goes wrong, giving you two layers of protection instead of one.