 pay more interest for every £500 borrowed through PayPal Credit. 1 Paypal customers could be charged more from today Credit: Rex Similar to using a credit card , PayPal Credit offers users the chance to borrow money for their purchases when they checkout online. Shoppers will be sent a monthly statement which they then must pay back in instalments. But PayPal credit is not interest-free meaning customers will an extra amount on top of how much they borrowed. The interest rate that a customer is charged is based on their credit score and PayPal offers three typical rates. These are currently 21.9%, 25.9% and 29.9%. However from today (September 1) PayPal is raising the lowest rate of interest charged from 21.9% to 23.9% APR. It means that for every £500 borrowed, customers will now pay 69p more per month. So if you've borrowed £1,000, you'll pay £1.39 more per month. Customers have been warned about the change before it came into place today. When it was first announced in July , a PayPal spokesperson said: "The change is in response to an increase in the underlying costs of us providing PayPal Credit to our customers. "We encourage customers to contact us with any questions or concerns the change could impact on their current financial situation." Are there alternatives? Before using PayPal credit, think about your options — and find the cheapest way to borrow. It's really important to only borrow money if you're able to pay it back, otherwise you could end up in a lot of unwanted debt. If you already have a no-interest credit card or overdraft , then you may want to stick with those rather than Paypal credit. You'll also be covered by Section 75 refund protection if you borrow through a credit card. Another option, which might suit those wi){kind=link}
PAYPAL customers will be hit with extra surcharges from today and they won’t be happy.
Shoppers using the global payment platform will now (September 1) pay more interest for every £500 borrowed through PayPal Credit.
Similar to using a credit card, PayPal Credit offers users the chance to borrow money for their purchases when they checkout online.
Shoppers will be sent a monthly statement which they then must pay back in instalments.
But PayPal credit is not interest-free meaning customers will an extra amount on top of how much they borrowed.