In this complete guide, we’re going to walk you through our PayPal Credit UK review to give you the lowdown on everything you need to know about PayPal Credit, including how it all works and whether or not it can impact your credit score.
PayPal credit allows you to Buy Now, Pay Later (BNPL), so that you can make purchases across thousands of online retailers, and similarly to making a payment on a credit card, you can enjoy the purchase now and pay for it later.
From how PayPal Credit works to how to get PayPal Credit, plus all our top tips on where and how to use it, we’ve got you covered with everything you need to know in our comprehensive guide right here.
PayPal themselves define PayPal Credit as “like a credit card, but without the plastic”.
In short, PayPal attaches a credit limit to your PayPal account which you can use to make online purchases at any online retailer that accepts payments via PayPal.
PayPal Credit works by essentially allowing you to “borrow” money from them in order to make purchases online; it acts like an online-only credit card.
Similarly to a credit card that has an interest-free period, PayPal Credit doesn’t charge you interest on your repayments, providing that you pay your balance within the set timeframe.
When it comes to discovering where you can use PayPal Credit online, you’ll be happy to know that there are thousands of online stores that accept it, including popular retailers such as ebay, Apple, Samsung, Groupon and many more.
A full list of accepted stores can be found on the PayPal website.
Some online stores have simply chosen not to accept PayPal credit as a form of payment and some business categories are exempt from PayPal credit by default such as adult content and gambling.
There are many debates as to whether PayPal credit affects your credit score or not, as some claim that PayPal reports to the credit reference agencies when you apply for an account and some claim that they don’t.
However, it can be argued that as PayPal carries out a full credit check when you apply for a PayPal Credit account, your credit rating can be affected even if your application is successful.
With any type of credit that you apply for, you can usually always expect it to have some kind of impact on your credit score, whether that's in a good way or not, so it’s always best to be aware of this before you apply for any kind of credit.
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In order to qualify for PayPal Credit, you’ll need to complete a short questionnaire that can be found on the PayPal website.
The application form should only take a couple of minutes for you to complete and if your application is approved, you will then be given a credit limit that is automatically linked to your account.
You must also ensure that you meet the following criteria in order to qualify for PayPal Credit:
Once you’ve been accepted for PayPal Credit, the team at PayPal will be regularly reviewing your account and once you’ve had your account for at least three months, they may invite you to increase your credit limit.
On the other hand, if you don’t want your PayPal Credit limit to increase, you can always ask for it to be decreased if it automatically increases, or you can ask to be excluded from increases from when you first open your account.
You can’t request a credit limit increase yourself, you have to wait to be eligible for the increase and then PayPal will invite you to increase your limit if you want to.
You can make your PayPal Credit payments in numerous different ways as well. Firstly, you can set up a direct debit to go out each month which will allow you to automatically pay the amount you choose, rather than doing it manually yourself.
Alternatively, you can also make a payment or schedule an additional payment by clicking the “make a payment” button on the PayPal Credit home screen.
Learn more: The Advantages and Disadvantages of Using Credit Cards
There are many debates as to whether PayPal Credit is a good idea or not. We’ve put together a brief pros and cons list below to help you weigh up the decision of whether PayPal credit is right for you or not.
PayPal Credit offers a 0% interest-free offer for four months when you spend over £99. You automatically benefit from the 0% interest-free offer every time you spend £99.
Before you can close your PayPal Credit account, you must ensure that your balance is paid off in full. Then, you can call the PayPal customer services team who will be able to assist you with the closure of your account.