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PayPal Business Debit Card Review
No annual fee and 1% cash back on all purchases are attractive features for the PayPal Business Debit Mastercard, though the benefits package can't compare to what you'll get with a high-end business credit card.
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Expert Analyst & Reviewer
UPDATED
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PayPal Business Debit Card
| Total Rating | 3.5 |
|---|---|
| Rewards For Spending | Good |
| Redeeming Rewards | Good |
| Card Benefits | Fair |
| Rates & Fees | Fair |
Annual Fee
$0Minimum Recommended Credit
N/ARewards Rate
1% cash backPayPal Business Debit Card At A Glance
- Unlimited 1% cash back on all purchases
- Cash back is automatically credited to your PayPal Business account on a monthly basis
- $1.50 ATM withdrawal fee
What We Like About PayPal Business Debit Card
- Card is directly linked to your PayPal Business account
- Rewards accrue automatically and never expire
- Instantly transfer funds between your bank account and your PayPal Business account without paying any fees
What We Don't Like About PayPal Business Debit Card
- The $1.50 ATM withdrawal fee
- Few business benefits
The humble debit card isn’t considered one of the sexier financial instruments around. PayPal aims to challenge this perception with the PayPal Business Debit Mastercard. It’s a debit card that gives you cash back for your business spending.
Businesses looking to cut out the middle man and make purchases directly from their PayPal business accounts can easily obtain the PayPal Business Debit Mastercard and earn 1% cash back on all eligible purchases. Combine this with the card’s lack of an annual fee, and you have a handy way to earn some extra cash with your business spending without having to worry about interest charges. You can use the card wherever Mastercard is accepted.
Unfortunately, the card carries some drawbacks as well. When you use the card at an ATM to make withdrawals from your PayPal business account, you’ll face a $1.50 ATM withdrawal fee. And when you use the card at an ATM outside the US, your withdrawal will be subject to a 1% foreign transaction fee on top of the standard $1.50 withdrawal fee. If you need to make frequent cash withdrawals at ATMs using this card, these charges can add up fast.
Do the advantages of using the PayPal Business Debit Mastercard outweigh the disadvantages? This review should help you make an informed decision that benefits your business. Also, read this comparison piece that looks at Paypal Credit VS Debit Cards and details the similarities and differences between PayPal’s other credit and debit cards.
Table of Contents
PayPal Business Debit Card At A Glance
PayPal Business Debit Card | Annual Fee: $0
Purchase APR: N/A |
|---|---|
Eligibility
Because this is a debit card that simply allows you to spend and withdraw funds from your PayPal business account, there are no credit score requirements whatsoever. All you need to get the card is a PayPal business account that is not currently under any restrictions.
To get the PayPal Business Debit Card, simply log into your PayPal business account, visit the PayPal Business Debit Mastercard page, and click on the button marked Get Started. You’ll then need to provide some basic financial information. Once your debit card has been activated, you’ll be able to enroll in the card’s cash back program (this does not incur any additional costs).
Rewards For Spending
Herein lies the PayPal Business Debit Mastercard’s primary selling point.
Unlimited 1% Cash Back On All Purchases
You’ll be earning 1% cash back on every eligible purchase when you use the card. Note that you won’t earn any cash back on ATM withdrawals, nor will you earn any cash back for PIN transactions. That’s why you’ll need to run your purchases as credit card transactions to earn cash back.
While the 1% cash back earning rate is great for a debit card, it’s not very impressive when compared to the cash back earning rate of the typical cash back business credit card. If you’re specifically looking for a debit card to use for business spending, the PayPal Business Debit Mastercard stands out among the crowd. However, if you’re not restricting yourself to debit cards, you’ll want to consider the superior rewards programs of the leading business credit cards — as well as the limitations inherent to debit cards — when making your decision.
Note that you can link your PayPal account directly to your business bank account, so you don’t even need to carry a PayPal balance to make purchases and receive cash back using the card.
If you’re interested in a PayPal credit card that offers a higher earning rate for cash back, check out our PayPal Cashback Mastercard review. The PayPal Cashback Mastercard offers an unlimited 2% cash back on all purchases, making it the more lucrative cash back option.
Redeeming Rewards
With the PayPal Business Debit Mastercard, you won’t have any choice in how your rewards are redeemed. This can be a curse or a blessing, depending on your expectations.
Earn Rewards As Cash Back Automatically
Your cash back is calculated at the end of each calendar month and then automatically credited to your PayPal account. You’ll need to have accumulated at least one dollar in cash back by the end of the month to receive the payout — accrue less than $1 and you won’t receive your payout, nor will your cash back carry over to the following month. If you spend over $100/month using the PayPal Business Debit Mastercard, you won’t have to worry about this restriction.
Business owners who prefer to receive cash back automatically without having to remember to redeem the cash back themselves will appreciate this simple method of rewards redemption.
If you’re looking for a PayPal card with a more versatile rewards scheme, have a look at our PayPal Extras Mastercard review. While it is a personal credit card, the Extras Mastercard gives you several redemption options: gift cards, merchandise, travel awards, or cash deposited directly into your PayPal balance.
Rewards Don’t Expire
The cash back you earn will never expire. Note, however, that if you don’t use your debit card for 12 months, you’ll no longer be eligible to earn cash back, and you’ll have to re-activate the cash back program to start earning cash back with your purchases again.
Card Benefits
You’ll enjoy some basic benefits with your PayPal Business Debit Mastercard, though the benefits package can’t compare to what you’ll get with a high-end business credit card, nor will you find such perks as a signup bonus.
Fraud Coverage & Alerts
You will get protection against identity theft (including monitoring and alerts) and enjoy zero liability for any unauthorized charges. It’s what you’d expect to see in a business card.
Travel Perks
You’ll also have access to Mastercard’s standard basic travel benefits: Mastercard Airport Concierge, 24/7 access to Global Emergency Services, and car rental insurance. You won’t be getting any advanced travel benefits, such as a Global Entry/TSA PreCheck fee credit or lounge membership or anything like that, though.
Free Employee Cards
You can also get debit cards for your employees to use at no additional cost. This is a benefit commonly found in leading business credit cards, but it’s good to see it included here.
Rates & Fees
This is a debit card, so there’s no regular APR (or introductory APR) to discuss here. However, there are some unfortunate fees you’ll have to be mindful of.
No Annual Fee
The PayPal Business Debit Mastercard’s lack of an annual fee means that you won’t have to weigh the cash back you earn against the cost of having the card. Of course, this is just a debit card, and considering the modest level of benefits and perks available, the lack of an annual fee is perhaps to be expected.
Other Fees To Keep In Mind
This is what hurts the card’s usefulness as a debit card. Each time you make an ATM withdrawal, you’ll be contending with a $1.50 ATM withdrawal fee (this is on top of whatever fee is being charged by the ATM owner). And if a signature is required for your cash withdrawal, you’ll pay a $3 fee.
Are you going overseas? Be aware that you’ll be paying a $1.50 withdrawal fee and a 1% foreign transaction fee on what you take out.
With these withdrawal fees, you probably won’t want to make frequent withdrawals with the card. That’s quite unfortunate, as that’s one of the main reasons to have a debit card!
Is The PayPal Business Debit Card For You?
The PayPal Business Debit Mastercard has a few things going for it for small business owners.
If you’re specifically looking for a debit card that offers cash back on your business purchases, you’ll find that here — and the unlimited 1% cash back you’ll be earning will automatically get deposited into your account each month without any input required from you. Additionally — and this is an undersold benefit — you’ll be able to instantly transfer funds between your bank account and your PayPal account without paying any fees.
Regrettably, if you use the card to make ATM withdrawals with any frequency, you may end up losing much of the cash back value you earn to ATM fees. Furthermore, you won’t see much in the way of extraneous business benefits with this card. And because this is a debit card and not a credit card, using this card won’t help you build up your credit.
You might want to apply if:
- You want a debit card linked to your PayPal business account
- You want cash back rewards that automatically accrue because you have better things to worry about
- You want to transfer funds between your bank account and your PayPal account without incurring a 1% transfer fee
You might want to look for a different card if:
- You want a business card that offers nice benefits and/or a signup bonus
- You want a card that provides heightened rewards on select spending categories
- You want a debit card that doesn’t subject your ATM withdrawals to a $1.50 fee
Jason Vissers
Expert Analyst & Reviewer at Merchant Maverick
Jason Vissers has been researching, analyzing, and writing about small business software and finance since 2015. His financial expertise has been cited in numerous publications, including The Ladders. Jason graduated with a Political Science degree from San Diego State University in 2001.
View Jason Vissers's professional experience on LinkedIn.
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Organization Name: Garden Galleries Botanicals
When deciding whether to use Paypal’s business debit Mastercard, be mindful of a serious drawback if you need to dispute a charge. Unlike a Mastercard credit card, you cannot dispute a charge until Paypal pays it, even if you ask for the payment not to be made while the charge is still “pending.” Instead, you must wait and watch while Paypal makes the payment, then initiate a dispute and the entity paid then has 7 days to respond to the dispute. If Paypal thereafter finds your dispute worthy, only then will they issue you a provisional credit.
This comment refers to an earlier version of this review and may be outdated.
Organization Name: Bender Services
This card is pretty darn terrible. It doesn’t work at many places, especially gas stations and restaurants, so I will be on a trip and become nearly stranded as I have to use personal monies to purchase fuel and then deal with the bookkeeper when I get back and explain how I didn’t do it the right way and turn in receipts and… pain in the… And then I will take a client out to eat or etc and have the embarrassment of being told my card was declined. We have well into six figures in this account, and these are purchases at locations which are in a close radius to the office, and not out of the ordinary, it’s just like they dont want you to be able to use your money.And THEN we had an issue where we had some fraudulent charges so we ended up having to change the number, and with any other company they send you a card immediately… Paypal business? 2-3 weeks. Useless. You have to have a second account somewhere else, so in the end there really is no point. I wouldn’t recommend.
This comment refers to an earlier version of this review and may be outdated.