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What Is PayPal Credit & How Does It Work?

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Advertiser Disclosure: Our unbiased reviews and content are supported in part by affiliate partnerships, and we adhere to strict guidelines to preserve editorial integrity.
Shannon Vissers

Shannon Vissers

Shannon is a writer and editor based in San Diego, CA. Shannon attended San Diego State University, graduating in 2005 with a BA in English. She is the former editor-in-chief of SteelOrbis, an online trade publication. Shannon has also published articles for LIVESTRONG.COM, eHow, Life'd, and other websites. She has been with Merchant Maverick since 2015, writing about POS software, small business loans, and financing for women entrepreneurs.
Shannon Vissers
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12 Comments

Responses are not provided or commissioned by the vendor or bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the vendor or bank advertiser. It is not the vendor or bank advertiser's responsibility to ensure all posts and/or questions are answered.

    mark

    if you pay your purchases in full with the 6 months no interest, do you still have to pay the deferred interest on the account? I’ve paid one account that was due April of this year (2020) in full but noticed I have deferred interest. Am I still on the hook to pay off this deferred interest which has been tacked onto my account?

      Shannon Vissers

      If you pay off your balance in full within 6 months, you should not be charged deferred interest, as long as your transactions are each $99+, and you made all your minimum monthly payments. If you did all of those things, I would definitely ask them why they’ve charged you the deferred interest.

        Steamy

        Thanks for the review. If customer defaults on loan using PayPal credit, is the merchant on the hook to pay PayPal to outstanding balance?

          This comment refers to an earlier version of this post and may be outdated.

          Jessica Dinsmore

          Hi Steamy,
          In this scenario, the merchant is definitely not on the hook. When a customer pays with PayPal Credit, it’s just as if they paid with a credit card. So it would be like if a customer pays with a credit card and then doesn’t pay their credit card bill.

            This comment refers to an earlier version of this post and may be outdated.

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            D'Angelo Cain

            PayPal credit actually does report to credit bureaus now

              This comment refers to an earlier version of this post and may be outdated.

              Jessica Dinsmore

              Thanks for letting us know, D’Angelo! We’ll have our editorial team look into it and include any changes in the next update.

                This comment refers to an earlier version of this post and may be outdated.

                Max

                Question: Is it 6 months interest free from the time that you open a PayPal Credit acct, or are they offering six months interest-free for each transaction as long as it’s paid off from the time of purchase?

                  This comment refers to an earlier version of this post and may be outdated.

                  Shannon Vissers

                  Hi Max, regarding promotional purchases, looks like you will not be charged interest on the purchase for 6 months, starting from the time of purchase, not when you open the account. Not all purchases qualify for this deferred-interest promotion though. See terms on PayPal’s website

                    This comment refers to an earlier version of this post and may be outdated.

                    Tyler Lawrence

                    Do you need to have credit in order to use this app?

                      This comment refers to an earlier version of this post and may be outdated.

                      Emily Hale

                      Hi Tyler,

                      Thanks for your question; I hope to clear things up for you. Yes, they’ll do a hard credit pull to check your credit and determine approval or denial (and how much your credit line will be). Hope this helps!

                        This comment refers to an earlier version of this post and may be outdated.

                        Birginia

                        Will I recieve a credit card throu the mail

                          This comment refers to an earlier version of this post and may be outdated.

                          Shannon Vissers

                          Nope! PayPal does offer credit cards, but that’s not what this is; PayPal Credit is a digital line of credit. On this page, you can see a breakdown of PayPal’s different credit products: https://www.paypal.com/us/webapps/mpp/credit-line-and-card-services

                            This comment refers to an earlier version of this post and may be outdated.

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