Is PayPal Safe? [11 Tips to Buy and Sell Safely on PayPal]

PayPal is one of the top web-based financial transaction tools online, with millions of users paying for goods, services, and content on the platform. However, even the largest companies often have trouble ensuring that all customers’ security is protected, and PayPal is no different. 

In order to avoid scams, fraud, and theft as both a buyer and a seller, it’s important to know the safety precautions that make using PayPal safe. In this article, we’ve compiled a collection of the most important tips for buying and selling safely on PayPal. 

You can read through for a full guide to PayPal security, or jump ahead to one of the topics listed below if you know the exact question you’d like to see answered. 

• Is PayPal safe to use?
• Is PayPal safe for sellers?
  • PayPal seller protection 
  • PayPal scam prevention tips for sellers
• Is PayPal safe for buyers?
  • PayPal buyer protection
  • How to make a safe PayPal transaction
• Know the different kinds of PayPal transactions
  • PayPal Friends and Family
  • PayPal Goods and Services
• PayPal refund policy — how to dispute a charge on PayPal
• Key Takeaways

Is PayPal safe to use?

In general, PayPal is safe to use. It’s a secured platform, and does not display any credit card or bank information to other users. 

Is PayPal safe for sellers?

PayPal is designed to be safe for both buyers and sellers. All information that is communicated between your device and PayPal’s servers is secured and encrypted as long as the network you’re using is secured. 

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

In fact, PayPal fraud is pretty uncommon — accounting for only about 0.32% of revenue. 

PayPal seller protection 

PayPal has a number of seller protection protocols in place to make sure that merchants feel safe and confident using their platform. Here are a few of the PayPal protection measures sellers can expect:

• Transactions only require a username and password, so no financial information is revealed during transactions. 
• PayPal offers 24/7 monitoring on all transactions.
• PayPal uses advanced machine learning and encryption techniques to secure each transaction.
• They provide Merchant Fraud Protection, so you can contact PayPal directly if something suspicious appears on your history. 
• They will help you resolve disputes by putting holds on transactions until the issue is solved. 
• PayPal allows you to securely operate in 202 countries, so you’re not just restricted to your own currency. 

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 you have been wronged:

• Always use a service like UPS or USPS, so there is documentation that you delivered the item. 
• Require an e-signature for purchases. 
• Ensure that all items you sell are clearly explained and described — this avoids customers feeling they have been misled. 
• 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. 

If you’re new to ecommerce, be sure to read our longform guide that contains everything you should know about how to sell online. 

Is PayPal safe for buyers?

PayPal isn’t just secured and encrypted for sellers; it’s also a secured platform for buyers, too. PayPal works to ensure that transactions are secured on both ends, so neither party is likely to be victim to PayPal fraud or a scam. 

PayPal buyer protection

PayPal is serious when it comes to buyer protection. They know that their users count on them to facilitate fast, effective, and safe transactions. To ensure this, they have put into place a set of security measures that protect buyers from scams, fraud, and theft:

• PayPal does not share your financial information with sellers.
• They offer 24/7 monitoring on all transactions.
• PayPal uses encrypted security technology on both buyer 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 do have a dispute with a buyer or potential fraudster, PayPal offers dispute resolution, putting a hold on funds until the issue is 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 users’ responsibility to ensure they use the platform in a secure manner. There are a few tips to keep in mind if you plan on purchasing online. The best way to make PayPal safe for yourself as a buyer is to follow a few safety guidelines:

• Use a credit card rather than a debit card. There are two main reasons for this:
  • First, if there is a disputed purchase, and PayPal won’t refund you, you can still contact your credit card company to see if they will intervene.
  • And second, if someone has gained unauthorized access to your PayPal account, they won’t be able to empty out your bank account if your account is connected to a credit card. 
• Use a safe password. This goes without saying on any internet account, especially ones that contain sensitive financial information.
  • A good password should have a mix of uppercase and lowercase letters, numbers, and other characters (such as @, &, #, or others).
  • This is one of the best identity theft protection moves you can make.
    
• Regularly update software. For instance, if you use the PayPal app on your phone, it’s important to regularly update it.
  • Older versions are more susceptible to hacks, as they lack the most up-to-date security features that PayPal regularly adds to its software.
    
• Avoid making financial transactions on public WiFi. You can’t always avoid it, but when you can, it’s a good idea not to use public networks for your financial transactions.
  • It’s possible for other users on an unsecured network to intercept information about your purchase. Instead, use mobile data when away from home if you can. 

Want more information on managing online payments safely? Read our guides on how to spot a scam and coronavirus fraud so you know what to watch out for as you shop online. 

Know the different kinds of PayPal transactions

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

PayPal Friends and Family

PayPal allows users to send money to friends and family. It’s a convenient way to:

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

However, there is a small fee that is applied to friends and family transactions, so be sure to factor this into your calculations if you are using PayPal to send money to someone you know. The fee can be paid either by the sender or the recipient. 

Pro-Tip: There is no fee attached to sending a personal payment if you use a PayPal Cash or PayPal Cash Plus account to send money. 

PayPal 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. When using this method of payment, note that the seller pays the transaction fee, not the buyer. 

PayPal refund policy — how to dispute a charge on PayPal

There are a number of ways that you can request refunds on PayPal.

1. When a transaction is already completed

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 the “Issue a refund” option. 

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. If the seller hasn’t accepted your payment for 30 or more days, you are automatically refunded. 

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

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

PayPal safety: key takeaways

PayPal is a safe and convenient way to pay for goods and services, send money to friends and family, or accept payments from customers and clients as a seller. However, it’s important to know how to use the platform safely. Here’s what to remember:

• PayPal provides a number of safety protocols for sellers, including encrypting financial data, fraud protection, and 24/7 monitoring. 
• Even with built-in protection for sellers, it’s still wise to follow safe practice tips:
  • Use a service like USPS or UPS
  • Require a signature from buyers
  • Clearly explain your products, and always provide quality customer service
• PayPal is also safe for buyers. They include the same set of security protocols for buyers that they do for sellers, including encrypted data and fraud protection, as well as dispute resolution. 
• As a buyer, be sure to keep tips like these in mind:
  • Opt for paying with a credit card rather than a debit card if you can
  • Use a secure password
  • Update your app to have access to the newest security features
  • Avoid making financial transactions on public WiFi
• PayPal also allows you to cancel or dispute payments if something goes wrong

PayPal is convenient, fast and secure. By using the right security measures, you can complete your transactions with peace of mind.