Do I earn points when paying with Paypal using a linked credit card?

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I purchase a lot through paypal and was wondering if i can setup my paypal purchases to use these cards or if that would be considered a cash transaction and not be elegible to gain points?

Also are there any fees for using amex with paypal?

BTW, i’ve been reading a lot from your site and am really thankful for the quality info you provide, its helped me a lot with understanding how to get the most out of my spending!


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Great Response

The short answer is, yes, you get points. So better use your Amex.

Any surcharges? Depends on the recipient. PayPal do charge a fee for its transaction, but many seller will absorb the cost. So whether Amex or MC, no difference. However, if u r transferring money to a friend/family, then the surcharges will be deducted from the amount you transferred. I believe it’s 2.6% + $0.30

  • Oops, correction. When you transfer to a merchant or service, the recipient will receive an amount after the deduction, so the merchant absorb the cost. But transfer to friend, the surcharge will be added on top of the amount you want to transfer.

    Eg, if you transfer $100, if it’s a merchant, he’ll receive ~$97.10. But if you transfer to a friend, then $2.90 will be added on top, so you’ll need to transfer $102.90.

    I personally can’t tell you if you will earn points for transfer to friends (you can always experiment by transferring $1) as I never done it myself, as that is practically cash in advance, you may get busted with your CC company or paypal. You can choose “pay a merchant/service” and cover the surcharge yourself and I can tell you that you will earn the full points including surcharges. But it may have tax implication on the recipient.

  • Great, thanks for the info Michael, they’re all merchants, no cash transfers so should be right! I’ll give it a go.

    Cheers, Daz

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