PayPal Brokers 2022 - Which Brokers Accept PayPal?
PayPal is a safe and reliable method of transferring money over the internet. Those who join are frequently pleased with the high level of customer service on offer. In this article, we discuss the pros and cons of trading with PayPal brokers, the fees involved, plus additional facts to help you sign up and log in. We also list the best forex brokers accepting PayPal deposits.
What Is PayPal?
PayPal is an online payments system initially designed to replace manual cheques and money orders. Nowadays, its primary purpose is to enable secure payment for goods and services via the internet. As a result, many online brokers accept PayPal deposits and withdrawals.
The PayPal website was formally founded in 2001 when the owner, Elon Musk, renamed the partnership between his two companies X.com and Confinity. The firm went public in 2002 and shortly after, was bought by the online auction site eBay for $1.5 billion. The relationship between eBay and PayPal was fruitful for both parties. It gave security and legitimacy to online payments for goods for the first time in internet history.
Nowadays, PayPal offers much more than secure payment for secondhand goods. Services such as PayPal credit and money pool make it popular for individuals. Plus, PayPal business accounts, loans service (AKA Working Capital) and a point of sale function named ‘Here’ make it perfect for start-up businesses.
Increasingly, the world’s largest e-commerce platforms allow PayPal, including Amazon. In the UK and worldwide, there are 280 million active PayPal users. PayPal trading stock recently rocketed upon the announcement that it will facilitate Bitcoin payments from 2021 in the US.
In forex trading, PayPal is a way of depositing or withdrawing funds with a broker. It is a popular method because of its wide use and consumer trust rating. Traders just need an account linked to a bank account. Accounts not linked to PayPal Credit or bank accounts are classed as unverified and have yearly withdrawal limits.
PayPal is free to sign up. Plus, there is no fee for purchasing goods and services using the e-wallet, meaning that depositing through a trading broker is usually free. However, there are fees on transfers abroad to international accounts. This may impact you if the PayPal brokers you are considering are not UK-based. There is more detail about international charges in the PayPal user agreement.
When withdrawing funds from a trading broker to a PayPal account, it would likely be regarded as a commercial transaction and therefore incur a £0.30 charge. This is a flat fee per transaction – no calculator required.
As of 2020, there is a new inactivity fee placed on dormant PayPal accounts. This can be avoided by logging into the service yearly.
Using PayPal to transfer money is fast. At most currency trading PayPal brokers, the deposit process is instantaneous. Refund and withdrawal times are broker dependant. But once approved, the process is quick. On average, withdrawal via PayPal takes 1-2 working days.
PayPal is known for its security measures, which makes it a trusted payment method. The service encrypts all its customer data, keeping your bank details safe. Plus, it goes beyond that offered by other payment providers by storing data on servers that are unconnected to its front-end. This means that even if PayPal is hacked, your details are secure.
If you’ve deposited money with a broker and are struggling to process a withdrawal, you can request a refund with PayPal within 180 days of the original transaction. Alternatively, if you believe you have not received the service you are paying for, you can open a dispute at the resolution centre.
For any queries related to PayPal payments, you can reach their UK support team using the 24-hour number available on their ‘Contact Us’ page. PayPal may need to verify your identity, but will then be able to help you with your questions and issues including scams, pending payments/refunds, money that is on hold, or if PayPal is just not working.
Alternatively, visit their online Help Centre to use the live chat function (known as the message centre). Customer service at PayPal is generally strong. This is one of their selling points as a business.
Forex brokers that accept PayPal typically have their own customer support teams that can also advise on payment issues.
How To Make PayPal Deposits & Withdrawals
To make a deposit and start trading using PayPal UK, you’ll first need to open an account. If you’re new to PayPal, visit the sign-up page and select open a ‘Personal Account’. You can do this on both desktop and mobile apps. You’ll then go through a verification process. This involves entering your telephone number to enable a text message security code. If you have a My PayPal account already, login using your email address and password. You can increase security by enabling 2-step verification.
You can either deposit funds into your PayPal account or create a direct link with your credit/debit card so that money will draw down automatically.
To make a deposit using PayPal on your broker’s website, follow the usual steps to fund your account and select PayPal as your payment method. The funds will be taken from your deposit balance or from your bank if you have linked one.
Pros Of Trading With PayPal Brokers
PayPal brokers offer all the benefits of conventional payment methods, for example, vs credit cards, plus some you’ll not find elsewhere:
- Easy-to-use – PayPal is an extremely intuitive and easy-to-use method for global trade. The website is designed with the user in mind and simplicity is a key factor in its offering.
- Security – PayPal places the utmost importance on security and support for purchases. At the touch of a button you can access your My PayPal transactions. This will show your payment history, enabling you to act if you spot anything suspicious.
- Mobile app – The PayPal app makes it easy to track transactions at the touch of a button. You can even pay using their One Touch fingerprint feature. Also, push notifications make you immediately aware of any payments from your account. You can download the app from the relevant app store.
- Credit card protections still apply – Section 75 of the Consumer Credit Act protects consumers from any breach of contract by your broker. For example, if your broker went bust or did not allow you to trade with your deposited funds, as long as your deposit amount is between £100 and £30,000, you’ll be covered. This rule still applies if you purchase with your credit card through PayPal as long as they have a ‘Commercial Entity Agreement’ with your credit provider.
- Bitcoin payments – PayPal has a better trust rating than other e-wallets that allow crypto payments. In 2021, in the US, PayPal began allowing payments using Bitcoin, Ethereum, Litecoin and Bitcoin Cash. It is likely they’ll continue to expand this functionality across the world, including the UK, in the next few years.
Cons Of Trading With PayPal Brokers
- Charges for withdrawals – If PayPal considers your transaction commercial, you may incur a fee for receiving funds. Some PayPal brokers also charge for withdrawals.
- PayPal holding money – Sometimes PayPal might enforce a ‘received pending’ or ‘payment cannot be completed’ notice on your account. The latter usually happens if there is not enough money to complete the transaction. This is one of the downsides of opening a third-party account to process transactions, rather than completing a payment directly with your bank.
- A target for scams – Many scammers target PayPal users via emails or text messages. They’ll often ask you to reveal your login details with the intention of accessing your funds. Often, the proceeds go on to finance crime. This doesn’t impact the security of the payment method, but customers should be aware that phishing communications are out there.
Final Word On Trading With PayPal Brokers
Overall, PayPal is a fast, secure and cheap option. There are usually no fees for depositing using PayPal, making it low-cost for traders. However, charges may vary if you need to send money internationally or if you’re withdrawing.
On the downsides, withdrawal to a PayPal account may incur a charge. Plus, PayPal is known for freezing accounts or holding money if there is an issue. Despite this, issues are usually resolved quickly and efficiently. Above all, PayPal is know for its smooth customer service ensuring it’s offered by a long list of regulated online forex brokers.
What Are The PayPal Transaction Fees?
PayPal does not charge for purchasing goods or services. Therefore, depositing funds with your broker is usually free. However, sending money international usually incurs a small charge which varies by location. Receiving money can also cost too. If PayPal deems the withdrawal a commercial transaction, there may be a charge.
Are PayPal Brokers Safe?
PayPal is widely deemed one of the safest e-wallet systems available. Its 2-factor authentication, data encryption and excellent customer service makes it a reliable payment method. With that said, it’s always worth observing your broker’s trading guidelines when making deposits with PayPal.
Why Has PayPal Limited My Account?
If PayPal has limited your account, this usually means they suspect someone is using it fraudulently. You can remove these limitations by going to the resolution centre. It will tell you the reason your account has been frozen and how to resolve it. You can also call the PayPal UK helpline where their staff will assist you. Alternatively, most brokers that accept PayPal deposits have their own customer support team that may be able to advise if there is an issue on their end.
Is PayPal Good For Traders?
PayPal is a good choice for depositing funds with a broker. It’s fast, reliable and secure. However, PayPal may charge for receiving funds. Also, some brokers only allow you to withdraw via the same method you deposited, so make sure you check the T&Cs before you transfer or you could face charges. Note brokers with PayPal functionality are listed in our review.
Is PayPal Going To Start Charging?
In 2020, PayPal started to charge for inactive accounts. Whilst the fee is only £12 per year, this is an unnecessary cost. To avoid this, just log into your account yearly. If you’re using your account to deposit with a broker, this also counts as an activity that would negate the fee. See our article for a PayPal supported forex brokers list, many of which also offer MT4.