How to use PayPal Friends and Family—and how not to use it

PayPal is a popular payment processor for businesses and individuals—but things get messy when you mix the two. here ’ s everything you need to know about PayPal friends and family transfers ( and a few friendly warnings as good ). note : The following applies to Personal PayPal accounts. If you have a PayPal Business explanation, friends and family payments may not be available to you .

What is PayPal friends and family?

When you send or request money through your personal PayPal account, you can choose whether it’s a “Friends and Family” payment or a “Goods and Services” payment. 

PayPal—Choose Sending to a friend Friends and Family payments are frequently used to pay back a acquaintance, deliver money to kin members abroad or send digital endowment cards .

How do I use PayPal friends and family?

In order to send money using PayPal friends and family, both you and the recipient role indigence to have a PayPal score ( you can set one up for dislodge ). Sending money with PayPal friends and family only takes a few steps:

  1. Login to your PayPal bill .
  2. pawlSend & Request .
  3. Under Send money , Enter phone number, email or contact name .
  4. When prompted, selectSending to a friend .
  5. Enter payment amount, add a note ( optional ) andSubmit .

PayPal Send a Payment Note: PayPal friends and family may not be available in some countries.  You can besides send friends and family payments using the PayPal app or PayPal.Me. The serve is pretty similar on the app—you fair enter the payment sum before selecting whether or not it ’ s a friends and class payment. PayPal Friends and Family Mobile

How much does it cost to use?

Friends and Family payments can be made to anyone in the U.S. for free (from your bank account or PayPal).  If you are sending money internationally, you may be charged a transaction fee equal to 5 % of the mail sum ( up to $ 4.99 USD ). When you pay with a debit or credit circuit board, you ’ ll be charged a minor processing fee—for both domestic and international transactions. presently the rate is 2.9 % + a situate fee ( varies by currency ; $ 0.30 in the U.S. ) .

Can you get scammed on PayPal friends and family?

unfortunately, yes. But you can always count on Michael Scott to get you out of a jam hera ’ s a good principle : If they’re not your friends and family in real life, they shouldn’t be your friends and family on PayPal.  occasionally, sellers will request that you make a purchase using PayPal friends and family rather than the traditional Goods and services requital. This can be a convincing controversy as there is no tip required, meaning they may offer you a discounted rate.

Don ’ t take the bait. In fact, using PayPal friends and family for business purchases is explicitly against their User agreement : “ You must not use the “ mail money to a supporter or class penis ” feature in your PayPal explanation when you are paying for goods or services. ” business owners know this angstrom well as should never ask you to pay in this manner. Take it as a crimson sag and good pay the goods and services tip. As one user commented “ 3 % is a little price to pay for peace of heed ”

Does PayPal reimburse fraudulent payment requests?

While PayPal does protect against “ Goods and Services ” scams, Paypal does not  reimburse “payments sent using PayPal’s friends and family functionality.” therefore, the following information lone applies to goods and services payments made from personal PayPal accounts. Items and services payments are protected by PayPal Purchase Protection. here ’ s what that means :

  • Your wide fiscal information is not shared with sellers
  • Transactions are encrypted and monitored 24/7
  • All global transactions are covered

For Buyers

According to PayPal ’ sulfur policy, you ’ ra protected if :

  1. You ’ re charged for something you didn ’ t buy
  2. Your order never arrives
  3. Your order arrives, but it ’ randomness different than described

If any of these things happen to you, PayPal guarantees to reimburse the full price of the purchase plus any embark costs ( just make certain you report the problem within 60 days of the transaction date ). PayPal asks that you work with the seller first, but if they refuse to hit the “ Issue a Refund ” button, you can open a quarrel in the Resolution Center .

For Sellers

For Sellers, the protection guarantees are pretty similar. Particularly, PayPal covers against two types of buyer complaints :

  • “ Unauthorized Transaction ”
  • “ Item not received ”

however, in order for Sellers to be protected by PayPal they need to have validation of manner of speaking or dispatch and be upfront with all the details. Learn more here .

Are there any alternatives to PayPal friends and family?

For business transactions, pretty much any business alternative is better than PayPal friends and family—Square, Stripe, even PayPal Business. In general, payment processors that are designed for buying and selling goods constantly afford better security—and they tend to have pretty fairly rates. For exemplar, ZipBooks free invoice allows digital payments for businesses, so you have better security and get paid faster. If you are actually transferring money between friends and family, PayPal is precisely one option. There are tons of great peer-to-peer requital apps out there. My go-to is Venmo, but I ’ ll let you compare for yourself.

About Tim Tim is Founder and CEO of ZipBooks. He keeps his desk truly courteous and neat .

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