The Ultimate Guide to Credit Cards
Friday, September 25, 2020

8 Best Credit Cards for PayPal

Best Credit Cards For Paypal

credit card advice

Adam West
By: Adam West
Posted: December 13, 2019
Advertiser Disclosure

PayPal started as the preferred payment option for the auction website eBay but has grown over the years into one of the most popular ways to pay for just about any online purchase. But before you send money to a merchant or loved one using the service, make sure you do it with one of the best credit cards for PayPal transactions.

That’s because the right card can net you rewards for your purchases, while still giving you the peace of mind that comes with PayPal’s buyer protection policies. When you combine PayPal with the right credit card, you quickly have one of the best and safest ways to make online purchases.

We look at each of PayPal’s branded credit cards in this review and their top alternatives that may net you even more rewards.

Cash Back | Points | VirtualPrepaid | FAQs

Best Cash Back Card for PayPal

The PayPal Cashback Mastercard® has many of the benefits associated with standard cash back cards, including a respectable 2% cash back on all of your purchases.

1. PayPal Cashback Mastercard®

If you’re a regular PayPal user (which you likely are if you’re considering this card), you can redeem your rewards as a credit toward your PayPal Mastercard® balance.

PayPal Cashback Mastercard®

  • 2% cash back on every purchase, no exceptions or rotating categories to keep track of
  • Redeem your rewards for PayPal balance credits with no redemption threshold
  • No annual fee

The main drawback to this card is that you can only redeem your rewards as PayPal credits, but you can always transfer that cash back to your PayPal Cash account, PayPay Cash Plus account, or a linked bank account.

Top Cash Back Alternative

If you’re looking for cash back on your purchases, you won’t find many better options than the Discover it® Cash Back card. This card can super-charge your cash back earnings thanks to its unique year-end bonus Discover offers new cardholders at the end of their first year.

2. Discover it® Cash Back

This card is currently not available.

Cash Back Rating

★★★★★
N/A

OVERALL RATING

N/A
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
N/A
N/A
N/A

There’s no limit to how much cash back you can earn. And, since you can rack up bonus cash back in rotating quarterly categories that include gas stations, grocery stores, restaurants, and Amazon.com (up to the quarterly maximum) — and then use that cash back on PayPal purchases — you’ll earn rewards much faster than with the PayPal Mastercard®.

Best Points Card for PayPal

If you want a little more flexibility in your earned rewards, then the PayPal Extras Mastercard® may be for you.

3. PayPal Extras Mastercard®

This card allows you to earn 3X points for every $1 you spend on gas and restaurant purchases, 2X points on PayPal and eBay purchases, and 1X points on all other purchases.

PayPal Extras Mastercard®

  • Earn up to 3X points on your purchases
  • Redeem your points for gift cards, travel vouchers, merchandise, or cash back credited toward your PayPal balance
  • No annual fee

You can redeem your earned points for gift cards (which requires 800 points for redemption), cash back (6,000 points equal a $50 cash reward applied to your PayPal balance), merchandise (minimum of 3,000 points required), and travel vouchers (15,000 points).

Best Points Card Alternative

The Wells Fargo Propel American Express® Card offers big rewards possibilities — with as many as 3X points on select purchases — without an annual fee. Even better, the card has more affordable redemption options that get you to your rewards faster.

4. Wells Fargo Propel American Express® Card

The icing on the cake may be the card’s signup offer of 30,000 bonus points when you spend $3,000 in purchases in your first three months with the card. You can redeem those points for $300 in cash — an amount that would take 36,000 points to accomplish with the PayPal-branded card.

Wells Fargo Propel American Express® Card

  • 0% APR on new purchases and balance transfers for 12 months
  • Earn 3x points on eating out and ordering in, gas purchases, and various travel and streaming services
  • No annual fee

Points don’t expire as long as the account remains open and in good standing. There are no blackout dates on air travel when redeemed through Go Far® Rewards.

Best Virtual Card for PayPal

If you’re only looking to shop online, a virtual credit card may provide the buying power you need. These credit accounts don’t include a physical card and you can only use them online with select retailers.

 5. PayPal Credit

The PayPal Credit account is a popular choice among online shoppers looking to finance a large purchase because it offers extended repayment periods without interest.

PayPal Credit Logo

  • No interest on purchases of $99+ if paid in full in 6 months
  • Only accepted where PayPal is accepted
  • No annual fee

While the interest-free period is a great way to make a big purchase without hefty finance charges, there is a catch. You must completely pay the balance of your purchase within six months to avoid backdated interest. If you don’t, you’ll find a lump interest charge for the entire six months added to your account balance once your 0% period expires.

Top Virtual Alternative

With the Capital One® VentureOne® Rewards Credit Card, you get both a physical credit card and a virtual card number thanks to Capital One’s Eno® virtual assistant. Not only will Eno send you card alerts to your phone, email, or smartwatch, but you can use the service to create unique, one-time-use virtual credit card numbers for secure online shopping.

BEST OVERALL RATING

★★★★★
4.8

OVERALL RATING

4.8/5.0
  • $0 annual fee and no foreign transaction fees
  • Earn a bonus of 20,000 miles once you spend $1,000 on purchases within 3 months from account opening, equal to $200 in travel
  • Earn unlimited 1.25X miles on every purchase, every day
  • Travel when you want with no blackout dates and fly any airline, stay at any hotel, anytime
  • Miles won't expire for the life of the account and there's no limit to how many you can earn
  • Transfer your miles to over 10+ travel loyalty programs
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
0% for 12 months
N/A
15.49% - 25.49% (Variable)
$0
Excellent, Good

And while you’ll benefit from the added layer of security, you’ll also earn 1.25X miles on every purchase you make. You can redeem those miles as statement credits to eliminate all or part of previously charged travel expenses. On top of that, you’ll also receive 0% financing for 12 months on all your new purchases.

Best Prepaid Card for PayPal

With the PayPal Prepaid Mastercard®, you can move money from your PayPal Cash Plus account to your card faster than if you reload your card via a linked checking account. You can also add money to your card at more than 130,000 Netspend Reload Network locations nationwide.

PayPal Prepaid Mastercard® Review

at Netspend'ssecure website

PREPAID RATING

★★★★★
4.8

OVERALL RATING

3.6/5.0
  • Move money from your PayPal account to fund your prepaid card account.
  • Earn cash back and personalized offers, just for using your card.
  • With Direct Deposit, you can get paid faster than a paper check.
  • Card issued by The Bancorp Bank, Member FDIC. Card may be used everywhere Debit Mastercard is accepted.
  • Click PayPal Prepaid Mastercard® for additional features & program details, and to request a Card.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
N/A
Variable Monthly Fee
Not applicable

The card gives you the flexibility to make purchases at any location that accepts Mastercard — which is just about everywhere. You can use the physical card in person or use your card number to shop online.

Top Prepaid Alternative

The NetSpend® Visa® Prepaid Card accepts a direct deposit of your paycheck or benefits check so you receive your money faster than you would with a paper check. You won’t incur finance charges or overdraft fees because this isn’t a credit card and it allows you to only spend the money you’ve loaded onto your account.

NetSpend® Visa® Prepaid Card Review

at Netspend'ssecure website

PREPAID RATING

★★★★★
4.7

OVERALL RATING

3.6/5.0
  • With Netspend Direct Deposit, you can get paid faster than a paper check.
  • No late fees or interest charges because this is not a credit card.
  • No Overdraft Fees on purchases using your card.
  • Use the NetSpend Mobile App to manage your account on the go and get text message or email alerts (Message & data rates may apply).
  • Card issued by MetaBank®, Member FDIC. Card may be used everywhere Visa Debit cards are accepted. Click "Get My Card " for full details.
  • See additional NetSpend® Prepaid Visa® details.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
N/A
Up-to $9.95 monthly
Not applicable

This card charges a variable monthly fee based on the type of account you have. The charges can range between $5 and $9.95 per month. Be aware of the charges you’ll face before you sign up for the card.

Is the PayPal Mastercard® a Good Credit Card?

The PayPal Cashback Mastercard® offers a bit more cash back than comparable competing cards. And while you can earn a solid 2% unlimited cash back and pay no annual fee, you won’t find much flexibility in the rewards redemption process. The only option the card provides is a balance credit to your PayPal account.

If you don’t have a PayPal account, you’ll have to call the issuer to apply your rewards as a statement credit — the option won’t be available to you online. Then again, you likely wouldn’t sign up for the card if you had no intention of creating a PayPal account.

Still, there are major potential issues with this redemption caveat. PayPal has a history of occasionally shutting down accounts with no warning or provocation. Should you find yourself in that predicament, you could risk losing your rewards.

Instead of linking yourself to a card that limits your possibilities, you’re better off researching cards that offer similar rewards without redemption hurdles. Some of the best cash back rewards credit cards offer far more than the 2% you’ll earn through the PayPal Cashback Mastercard®.

If you leverage quarterly categories, you could make the most of your spending by earning cash back rewards. Pair the bonus earnings categories with a unique year-end bonus at the end of your first year and competitive introductory rates on both purchases and balance transfers, you can’t go wrong.

Since PayPal allows you to link any active credit card to your account, you can use any of these cards in the same way you would use the PayPal Cashback Mastercard®.

Is PayPal Credit and the PayPal Mastercard® the Same?

No, they aren’t. In fact, PayPal Credit and the pair of PayPal Mastercards have many differences.

PayPal Credit is a line of credit that you can use only through merchants that accept PayPal payments. You’ll never receive a physical credit card for your account. Instead, you’ll access your credit line through the PayPal checkout portal when you’re choosing how to fund your purchase.

You can’t use your PayPal Credit account to make payments at in-person merchants. For that, you’ll need one of the PayPal Mastercards.

PayPal Comparison

PayPal Credit offers 0% financing and a 19.99% APR, but can only be used via PayPal. The pair of Mastercards have variable APRs and rewards and can be used everywhere Mastercard is accepted.

The Cashback Mastercard and Extras Mastercard are physical credit cards that allow you to make purchases at any location that accepts Mastercard, which is just about everywhere. You’ll earn cash back you can redeem directly into your PayPal account or earn points you can redeem for the various offerings listed above.

PayPal Credit offers no rewards structure, other than an occasional $10 welcome bonus when you make your first purchase. After that, you’ll only have a basic credit line with a 19.99% APR.

PayPal Credit also offers a six-month, interest-free period on purchases of $99 or more. The only catch is that you must pay your balance in full within six months. If you don’t you’ll face a whopping deferred interest charge that adds backdated interest to your balance.

Neither PayPal Mastercard® offers an interest-free period, and the variable interest rate each card charges will depend on your creditworthiness.

If you’re looking for a physical credit card that you can use anywhere, the PayPal Mastercard® is the better option between the two. PayPal Credit is a serviceable choice for online shopping — but it has caveats, which we’ll get to in the next question.

Does PayPal Credit Affect Your Credit Score?

The only real answer to this is yes — and no. You may see a slight change initially with no real long-term effect afterward.

While PayPal Credit is a traditional credit account (only without the physical credit card), it doesn’t report your payment behavior to the three credit reporting bureaus. That means on-time payments won’t help your score — but late payments won’t hurt it, either.

FICO Credit Score Factors

Inquiries fall into the New Credit category.

The only impact you may find is a hard inquiry that’s placed on your account when you sign up.

Whenever you apply for new credit, the lender will submit an inquiry to the credit bureaus to view your profile. Each inquiry lives on your credit report for two years.

Maintaining a few inquiries (typically three or fewer) has little to no impact on your credit score. But the more you accrue, the more desperate for money you may look to lenders. Excessive inquiries can cause a slight temporary dip in your credit score.

Other than that, a PayPal Credit account won’t impact or even be reflected on your credit report. This isn’t the account for you if you’re looking to rebuild your credit history after some mistakes. Although the acceptance standards are fairly forgiving, the account does nothing to help you improve your profile.

In all, the serviceable credit account will allow you to make online purchases through merchants that accept PayPal — but it won’t help you improve your credit score. If you’re going to make on-time monthly payments to a lender, you should find a credit card that will report your credit history and allow you to reap some credit score benefits for your hard work.

Don’t Compromise Your Security or Your Rewards

More than 1.8 billion people shop online each year. That’s a lot of credit card numbers floating around the web. If you’re a regular online shopper, chances are that you’ve interacted with PayPal in some form or fashion.

The company’s combination of security and customer protections makes it a great way to shop online without risking your privacy or financial information. And with one of the best credit cards for PayPal, you won’t compromise your rewards, either.

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