PayPal Friends and Family: How It Works, Fees and More

Picture of friends smiling and sitting in a cafe having coffee and using a phone.
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If you’re looking for a way to lend a friend some money or split dinner with family, PayPal Friends and Family makes it easy to send and receive money. Continue reading to learn about how the feature works, how much it costs and more.

What Is PayPal Friends and Family?

PayPal Friends and Family is a feature you can use to send and receive funds for personal reasons. For example, you could use it to repay a friend for dinner or get help paying your bills. While many PayPal users like to use Friends and Family for other types of payments, it is not ideal for business-style transactions, and there is a separate feature for buying or selling.

How To Use PayPal Friends and Family

The steps for sending money on PayPal are pretty similar across all devices and payment methods. You can follow the general steps below:

  1. Click “Send and Request” — or “Payments” on the PayPal app.
  2. Enter the recipient’s name, email address, mobile number or PayPal username.
  3. Enter the payment amount and add a note if you want to.
  4. Choose your payment type. This is where you would choose “Sending to a friend.”
  5. Choose your payment method.
  6. Review your payment information and then click “Send Payment Now.”
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If you’re using PayPal.me to pay, you can click the link that the recipient gave to you and then follow a set of similar steps. However, if you’re using PayPal and can’t change to the Friends and Family option, it’s likely because you can only send Friends and Family payments to personal accounts. So if your recipient only has a business account, you can only send a Goods and Services payment.

How Much Does PayPal Friends and Family Cost?

In many cases, it is possible to avoid paying PayPal fees while sending money with PayPal Friends and Family. If you send a domestic payment using either your PayPal balance, a bank account or an Amex Send™ account, there are no fees for the sender or the recipient.

However, if you send a domestic payment using a card, you will have to pay 2.9% plus a fixed fee based on the recipient’s currency. For example, the fixed fee for U.S. Dollars is 30 cents per transaction.

Sending international payments with PayPal Friends and Family has a 5% fee for every payment method. However, it won’t cost less than 99 cents or more than $4.99. If you use a card, you will also have to pay the 2.9% plus the fixed fee. In addition, you may need to pay a conversion fee if fees are charged in a currency other than the currency you use to send payments.

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Is PayPal Friends and Family Safe To Use?

One of the biggest concerns when using PayPal Friends and Family is that these payments are not covered by PayPal Purchase Protection. PayPal Purchase Protection ensures that buyers receive what they pay for by allowing them to file a dispute if they don’t receive their item or if the item is different than described. Therefore, using Friends and Family to buy an item or service is not recommended.

However, PayPal Friends and Family is a generally safe platform to use for sending and receiving personal payments. PayPal includes the following security features:

  • Hides important financial information from other users
  • Monitors transactions
  • Encrypts transactions
  • Assists with fraud
  • Dispute resolution and investigation
  • Purchase Protection for buyers and Seller Protection for sellers.

PayPal Friends and Family vs. 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.

Since PayPal Goods and Services is used for business, it will include PayPal Purchase Protection or PayPal Seller Protection. However, it will also include more fees for the recipient, or the seller in this case.

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While buying with PayPal Goods and Services is free for buyers — unless you need to convert currencies — seller fees may cost somewhere between 1.9% and 3.49% plus a fixed fee for domestic payments, depending on the payment method. For example, PayPal Invoicing and Pay with Venmo will have a 3.49% fee in addition to a fixed fee, while standard credit and debit card payments will have a 2.99% fee and a fixed fee.

Alternatives to PayPal Friends and Family

If PayPal Friends and Family isn’t exactly what you’re looking for, here are a couple of alternatives with similar features.

Venmo

Venmo is specifically used to send and receive money from friends and family. It combines financial transactions with socialization by letting you dress up your payments with fun extras like emojis, stickers, notes and more. In addition, you can add friends and allow other users to see your transactions. While it doesn’t show any financial information, you can also keep your transactions private. There are no fees to send or receive money unless you use a linked credit card, which is a 3% fee.

Zelle

Zelle is an easy-to-use payment platform that is already integrated with most mobile banking apps. Therefore, you may not even have to download the app or visit the website. You can simply log in to your banking app and send Zelle payments to your recipient using just their email address or phone number. If their bank partners with Zelle, the money will automatically move to their bank account, or they can download the app and set up a profile. Zelle also offers fee-free payments to friends and family.

Final Take

PayPal Friends and Family is a great option for quick payments to friends and family members for personal transactions. Some users might try to take advantage of fee-free payments to buy or sell, but this can come with risks. Therefore, you should ensure you’re using the feature responsibly to protect your money.

FAQ

  • Is PayPal still free for the Friends and Family option?
    • It is possible to send money for free with PayPal Friends and Family. If you send a domestic payment using either your PayPal balance, a bank account or an Amex Send™ account, there are no fees for the sender or the recipient. However, if you send a domestic payment using a card, you will have to pay 2.9% plus a fixed fee based on the recipient’s currency.
  • How do I avoid PayPal fees for the Friends and Family option?
    • You can avoid paying fees while sending money with PayPal Friends and Family by sending a domestic payment using either your PayPal balance, a bank account or an Amex Send™ account. There are no fees for the sender or the recipient by using this method. However, if you send a domestic payment using a card, you will have to pay 2.9% plus a fixed fee based on the recipient’s currency.
  • What makes PayPal Friends and Family different?
    • PayPal Friends and Family is a feature you can use to quickly send and receive funds for personal reasons, like using it to repay a friend for dinner.

Information is accurate as of Dec. 30, 2022. 

Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.

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About the Author

Taylor DeJesus has been a freelance writer for over five years where she specializes in writing SEO blogs and other online content for small and medium-sized businesses. She has also written books, research papers and more on a variety of topics, ranging from business and marketing to lifestyle. In her free time, Taylor likes to read, spend time with her daughter and achieve personal development goals.
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