Is PayPal safe?

Edited by: David Heiling
• Updated •6 min read
This date may not reflect recent changes in individual terms.
Young Asian woman sitting in a sidewalk cafe with a cup of coffee and using her smartphone.Image: Young Asian woman sitting in a sidewalk cafe with a cup of coffee and using her smartphone.

In a Nutshell

PayPal safeguards transactions and customer information using advanced encryption technology, fraud monitoring and prevention and several other protections. However, users can further minimize the risk of scams and fraud by updating software, using a secure network and choosing a complex password.
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PayPal safeguards transactions and customer information using advanced encryption technology, fraud monitoring and prevention and several other protections.

However, users can further minimize the risk of scams and fraud by updating software, using a secure network and choosing a complex password.

PayPal is one of the best ways to send money transfers online, allowing millions of users to pay for services, content and goods safely. However, many companies have trouble ensuring all customers’ security gets protected, and in some ways, PayPal is no different.

Knowing the precautions that make using PayPal safe is important to avoid scams, fraud and theft as a buyer and seller.

Is PayPal safe to use in 2024?

Generally, PayPal is safe for users. The secure platform conceals credit card or bank information from one user to the next.

Is PayPal safe for sellers?

By design, PayPal is a safe platform for sellers and buyers. As long as you’re on a secure network, PayPal’s servers will encrypt and secure all sensitive information you share through the platform.

  • Paypal security in public: It’s riskier to use PayPal on public Wi-Fi, like at a library or restaurant, as others on the network might be able to access your information (though this is still difficult).
  • Paypal security at home: When using PayPal on your Wi-Fi network, sellers can usually rest assured that the platform is safe.

PayPal fraud is uncommon — accounting for only about 0.17% to 0.18% of revenue.

PayPal seller protection

PayPal has several seller protection protocols to ensure merchants feel safe and confident using their platform. Here are a few of the PayPal protection measures sellers can expect.

  • You only need a username and password for transactions, ensuring your financial information stays safe.
  • All PayPal transactions receive 24/7 monitoring.
  • PayPal uses end-to-end encryption and machine learning to secure all transactions.
  • They provide Merchant Fraud Protection, so you can contact PayPal directly if something suspicious appears on your credit history.
  • They will help you resolve disputes by holding funds until the issue gets resolved.
  • PayPal processes 25 currencies, allowing you to operate securely in 202 countries.

PayPal scam prevention tips for sellers

There are a few measures that you can take to prevent scams as a seller, especially if it comes to a disputed transaction where you must prove to PayPal that someone wronged you.

  • Always use a delivery service like UPS or USPS. That way, there’s documentation you delivered the item.
  • Review your financial statements regularly. Transactions you don’t recognize can indicate fraudulent activity.
  • Ensure that all items you sell are clearly explained and described. This can help avoid customer confusion and disappointment.
  • Prioritize customer service. If you respond to customer complaints, they are less likely to have an issue with your business. You can also demonstrate to PayPal that you have been on top of buyer complaints.

Is PayPal safe for buyers?

PayPal isn’t just secured and encrypted for sellers — it’s also a secure platform for buyers. PayPal works to ensure encrypted transactions occur on both ends, so neither party is likely to experience PayPal fraud or a scam.

PayPal buyer protection

PayPal emphasizes buyer protection, recognizing that its users rely on them for swift, efficient, secure transactions. PayPal has security measures to safeguard buyers from fraud, theft and scams.

  • PayPal doesn’t share your financial information with sellers.
  • They offer 24/7 monitoring of all transactions.
  • PayPal uses encrypted security technology on both the buyer’s and seller’s ends to ensure a secure transaction.
  • They offer PayPal fraud protection and allow you to flag certain transactions as suspicious.
  • If you have a dispute with a buyer or potential fraudster, PayPal offers dispute resolution, putting a hold on funds until the issue gets resolved.
  • PayPal facilitates transactions in countries across the globe, making it possible to purchase things from other countries securely.

How to make a safe PayPal transaction

While PayPal may offer plenty of security protocols to its users, ultimately, it’s also the users’ responsibility to ensure they securely use the platform. There are a few tips to remember if you plan on purchasing online.

Use a credit card rather than a debit card. There are two main reasons for this.

  • If there’s a disputed purchase and PayPal won’t refund you, you can still contact your credit card company to see if they will intervene.
  • If someone has gained unauthorized access to your PayPal account, they won’t be able to empty your bank account if you connect a credit card to your account.

Use a safe password. This is a good idea for any internet account, especially those containing sensitive financial information.

  • A good password should have a mix of uppercase and lowercase letters, numbers and other characters (such as @, &, # or others).
  • A good password is one of the best identity theft protection moves you can make.

Regularly update software

  • Older software versions are more susceptible to hacks, lacking the most up-to-date security features that PayPal regularly adds to its software.

Don’t use public Wi-Fi for financial transactions. You can’t always avoid it, but steer clear of public networks for your financial transactions when possible.

  • Other users on an unsecured network could intercept information about your purchase. Instead, use mobile data away from home, as mobile carriers encrypt information.

The different kinds of PayPal transactions

There are two different ways that users can use PayPal to complete financial transactions.

PayPal with friends and family

PayPal users can use this personal transaction option as a convenient way to …

  • Send someone money you might owe
  • Chip in to buy something together
  • Send a gift

However, there’s a small fee if you make these “sending to a friend” transactions with a debit or credit card, so be sure to factor this into your calculations. Also, remember that PayPal’s Purchase Protection doesn’t cover these transactions.

PayPal for goods and services

You can also use PayPal to purchase goods and services from a buyer, whether that’s your local cafe or an online retailer. With this payment method, the seller pays the transaction fee, not the buyer.

PayPal refund policy: How to dispute a charge on PayPal

There are several ways to request refunds on PayPal, which we outline below.

1. After completing a transaction

If you have completed a transaction and the seller has accepted payment, you will have to ask them directly to refund your money. They can do this by going onto the PayPal app and selecting “Activity,” choosing the transaction and then using the seller’s information to contact them.

2. When a transaction is pending

If your payment is still pending, you can go to your Activity page and press the cancel button next to the payment. Additionally, if the seller hasn’t accepted your payment for 30 or more days, PayPal will refund your money.

3. When you’ve requested a refund on the transaction

If you have requested a refund, but the seller has denied it, you can open a dispute in the PayPal Resolution Center. If your dispute succeeds, they will refund the credit card, debit card or bank account you used to pay for the item.

Remember, you only have 180 days to open a dispute after the payment.

What’s next: Protect your credit

PayPal is a safe and convenient way to make payments for goods and services, send money to friends and family or receive customer payments. The platform also provides robust safety protocols for buyers and sellers, such as fraud protection, data encryption and continuous monitoring.

However, it’s important to use the platform safely. You can confidently make transactions by using security measures, such as paying with credit rather than a debit card, using a secure password and ensuring your PayPal app is up to date with the newest security features.

FAQs about PayPal safety

Can you trust PayPal?

PayPal employs robust security measures to protect users against fraud and unauthorized access. They use encryption technology and advanced data protection protocols to keep personal and financial information confidential. In addition, PayPal offers buyer and seller protection programs that safeguard against fraudulent practices.

Whether PayPal is safe to receive money from strangers depends on the safety measures you take. Verifying the sender’s legitimacy, thoroughly reviewing the PayPal user agreement and practicing caution during transactions can help ensure a safe experience.

Will PayPal cover me if I get scammed?

PayPal offers certain protections to its users, but whether or not you will be covered if you get scammed depends on several factors. PayPal’s buyer protection policy may offer reimbursement for unauthorized transactions or items not as described within certain guidelines.

Can I trust PayPal with my SSN?

PayPal requires you to provide your SSN when setting up your account. PayPal implements industry-standard encryption and security measures to protect sensitive data like SSNs and financial information.

That said, you’ll want to ensure you access the official PayPal website or app when providing personal information and be cautious of phishing attempts or scams.