In a world with over 100 payment systems, PayPal stands out as the most popular and significant player: according to Statista data, the number of active PayPal accounts worldwide was 427 million in May 2024.
Among numerous other valuable features, this payment platform offers exceptional service for non-commercial transfers between close acquaintances, such as PayPal Friends and Family. Transactions occur within a tight circle, and the funds are intended for personal use only.
The main advantage here lies in its rapid transfers and the absence of transaction fees for domestic transactions within the United States. This excludes any commercial or business-related operations. If a business account holder wishes to use this feature, they need to register a personal account.
How does PayPal Friends and Family work? How do you properly send and receive money through this service? The experts at Rates have put together a concise overview that will provide answers to all these questions.
Sending Money with PayPal Friends and Family
How do you send money using PayPal Friends and Family? Sending funds using this service is a straightforward process. Just follow these steps after logging into your account:
In the "Send Money" section, enter the recipient's details: name, phone number, and email address.
When prompted, select "Send money to friends and family."
Enter the payment amount and optionally add a note.
Choose your preferred payment method — linked bank account, PayPal balance, or connected debit/credit card.
Click "Send."
It's important to remember that all transfers beyond the United States are considered international and are subject to a fee. The size of PayPal fees for Friends and Family transactions depends on the destination country and the type of cards the sender and recipient use. To check the fee, input the payment amount in the designated field—the calculation will be done automatically.
Personal transfers to your loved ones or friends are free if you use your PayPal balance or bank account. Using a card will entail a 2.9% + fixed fee ($0.30 USD). There's also a $60,000 limit on the amount you can send in a single transaction (relevant for the US). It’s worth noting that PayPal tends to cut it down to $10,000 per transfer, although there's no limit on the number of transactions. So, if your sum exceeds the limit, you can split it into multiple payments.
In case of an account breach, the sender can dispute PayPal transactions through the Friends and Family service using the same process as other transactions.
Receiving Money with PayPal Friends and Family
How to receive transfers? It's super easy. Once your friend or family member sends you money, you'll receive a notification via email or the PayPal app letting you know that the funds have arrived.
The amount received will be added to your PayPal account. You can keep the funds in your balance for future purchases or transfer them to your linked bank account.
You can also receive funds from abroad using the Friends and Family service. PayPal supports international transactions and processes payments in various currencies. If your friend or family member is in a different country, they can send you money in their local currency. PayPal will automatically convert the funds into your country's currency.
However, remember that international transactions incur a fee. We recommend checking the exchange rates and applicable fees on the official PayPal website before making international transfers.
Conclusion
PayPal Friends and Family is a convenient and speedy service that allows you to make transfers between friends and relatives. The presence of fees depends on how you make a payment with PayPal Friends and Family. There's no fee if the transaction is within the US; otherwise, the fee amount depends on the country and currency.
Set up PayPal, create a personal account, and enjoy all the benefits of transactions using the Friends and Family service.
Personal transfers to your loved ones or friends are free if you use your PayPal balance or bank account. Using a card will entail a 2.9% + fixed fee ($0.30 USD). There's also a $60,000 limit on the amount you can send in a single transaction (relevant for the US).
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. Friends and Family payments are often used to pay back a friend, deliver money to family members abroad or send digital gift cards.
If a seller is encouraging you to send a 'Friends and Family' payment when you're buying a good or service, you should refuse. You could be dealing with a scammer who knows that your payment won't be covered by our Purchase Protection if it's a 'Friends and Family' payment.
Personal payments aren't covered by PayPal Purchase Protection. You can make a personal payment to anyone in the US for free if you use your bank account or PayPal Balance. If you use a debit or credit card, there will be a small charge for your payment.
We've stated that the standard PayPal fees for receiving money are 2.9% + $0.30 if both accounts are from the U.S., or 4.4% + $0.30 if the client's account is from another country. In these cases, the customer doesn't have to pay any fees, even if their account is from another country.
No, it's not possible to initiate a chargeback for PayPal Friends and Family payments. These transactions are not covered by PayPal's Purchase Protection Program.
“Friends and family” is for sending gifts. There's no reason that someone would ask for a gift back. If you are buying a product, you should not use “friends and family.” If you send the money using the business option, PayPal will charge a small fee but they will allow you to claim a refund.
If you're not a seller and your PayPal money is on hold, it could be due to several reasons: Unusual account activity: It will be uncommon if you receive a payment from a friend or family member for the first time or after a long time. In that case, PayPal will put the payment on hold for up to 21 days.
Buyer Protection covers all eligible online purchases where PayPal is used, as well as payments made through our website. To take advantage of Buyer Protection, we require, among other things, that accounts be kept in good standing and ask that a dispute be filed within 180 days of your purchase or payment.
How to receive money on my account with PayPal? To accept the money, you must open an account with PayPal and confirm your email address. After that, you can receive money when someone pays to your email address or mobile number. You'll receive a message through the app letting you know you have money available.
If you're using PayPal Friends and Family to send money within the US, you should have fees only when you pay with your card (or if you send in different currencies)¹: Paying with PayPal balance or a bank account: no fee. With Card: 2.9% + fixed fee. With Amex Send Account: no fee.
To put it simply, according to the article by Moneysavingexpert.com, “A PayPal spokesperson said: "PayPal Buyer Protection does not cover money transfers between friends or family. If someone selling you goods or a service asks you to send a friends and family payment, you should refuse.”
PayPal Goods and Services. While PayPal Friends and Family is for sending and receiving personal payments, PayPal Goods and Services is for sending and receiving business payments. For example, you can use PayPal Goods and Services to buy a physical or digital item or pay for a service.
Yes, Personal accounts can still receive friends and family payments for personal purposes. Why should I use PayPal for peer-to-peer payments? PayPal enables quick, easy, and secure payments between individuals and businesses almost anywhere in the world, whether you're across the table or in another country.
If you're not a seller and your PayPal money is on hold, it could be due to several reasons: Unusual account activity: It will be uncommon if you receive a payment from a friend or family member for the first time or after a long time. In that case, PayPal will put the payment on hold for up to 21 days.
When you make payments through PayPal using the "Friends and Family" option, it's important to know that these transactions are not eligible for disputes. PayPal's Purchase Protection Program doesn't cover such payments.
Introduction: My name is Mr. See Jast, I am a open, jolly, gorgeous, courageous, inexpensive, friendly, homely person who loves writing and wants to share my knowledge and understanding with you.
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