It is, mostly. Here are nine tips to keep your money safe on PayPal. It is very popular, but is PayPal safe?
How PayPal Safeguards Transactions
The online payment giant processed more than 3.74 billion transactions during the first quarter of 2021 alone, amounting to approximately 285 billion U.S. dollars. To keep these transactions safe, PayPal uses what they call “next-level encryption.” They also offer security features like two-factor authentication to further safeguard user accounts. Beyond that, PayPal has a Bug Bounty Program, which offers financial payouts to ethical hackers who identify bugs in PayPal’s defense systems. Together, these efforts make PayPal a generally safe platform for financial transactions. However, like any other online platform, PayPal is not bulletproof.
What You Can Do to Stay Safe on PayPal
Even with the most robust security features in place, sometimes PayPal accounts do get hacked. This is usually the result of a PayPal user falling for a phishing scam or other fraud attempts where people end up disclosing their login credentials or other personal information. The good news is that there are some easy steps you can take to keep your PayPal account safe.
1. Enable two-factor authentication
One of the easiest ways to protect your PayPal account (and all online accounts, for that matter) is to enable two-factor authentication (2FA). PayPal offers two ways to set up a second level of authentication for your account – using a SecurityKey (you will receive a code via text message each time you log in) or a third-party authenticator app, like Google Authenticator. To turn on two-factor authentication on your PayPal account, do the following.
2. Avoid using public Wi-Fi
Free Wi-Fi at coffee shops, train stations, and airports can seem like a great option to save on mobile data when you’re away from home. However, when you go online in a public space, you never know who is watching, or worse – capturing all the information you send online. There are countless threats that come with the convenience of using public Wi-Fi, especially when you transmit sensitive financial information, so it’s important to take steps for your safety while connected to public Wi-Fi. To keep your PayPal account information safe, it is best to avoid accessing your PayPal account on any public Wi-Fi hotspots. If you do need to check your PayPal balance or make a transaction, stick to using your mobile data.
3. Keep your software up to date
Security threats continuously evolve, and developers regularly update their software to address newly discovered issues. It is good practice to update your computer, smartphone, and apps whenever a new version of software is available. These updates almost always contain patches that address new security threats or vulnerabilities. Failing to keep your software up-to-date exposes you to unnecessary security risks.
4. Use a credit card as your funding method
Although linking your PayPal account to your bank account or debit card is easy and convenient, it is also a risky move. Should hackers gain access to your PayPal account, they can easily drain your bank account – often before you are aware of the hack. How far your bank will go to remedy the situation depends on your financial institution. In some instances, you may have no recourse at all. However, if you link your PayPal account to a credit card, your bank account shall remain safe. You also have additional protection, including directly disputing any fraudulent charges with your credit card company. This is in addition to the dispute you can lodge with PayPal itself.
5. Only deal with verified buyers and sellers
Anyone with an email address can open a PayPal account, including fraudsters. However, legitimate buyers and sellers take the extra step to get verified as a way to prove the integrity of their account. Verification involves providing additional identifying data to PayPal. This type of personal information, like a social security number (in the United States), is something scammers aren’t usually willing to provide, or simply don’t have. When you only engage with PayPal verified accounts, you greatly reduce the risk that the person on the other side of the transaction is someone trying to rip you off.
6. Avoid clicking on links in email
One of the most popular PayPal scamming techniques involves sending unsolicited emails. A PayPal user receives an email message claiming some sort of issue with their account, followed by a request to click on a link in the body of the email. Unfortunately, the link is fake and designed to get you to hand over confidential information, most often your login credentials. Here’s an example of a fake PayPal email we recently received.
It is easy to avoid falling victim to a phishing scam like this. Never click on links in emails you receive. To verify if a PayPal email you received is legitimate, open a browser and log in to your PayPal account from there. If the email was on the up-and-up, you will have communications in your PayPal message center. No messages in your account? Delete the email, it is spam. Also, when logging into PayPal, always check for the “lock” symbol to the left of the address bar.
7. Use a unique username and password
In today’s online world, one of the easiest ways to protect your PayPal account (and every online account, for that matter), is to use strong, unique login credentials. While you’ll often use your email address as the user name, your password should be different for each account. This is where a password manager comes in handy. Whether you use a third-party password manager or the one built into your favorite browser, you will be able to generate highly complex passwords at the click of a button. You’ll also be able to save your new passwords securely and easily auto-fill them anytime you want to log in to an account. Even if you still rely on the old “post-it note stuck to your computer screen” method of saving passwords (which we absolutely do NOT recommend), be sure to use a complex password that is unique to PayPal to keep your account secure.
8. Monitor your account
Relying on PayPal to execute financial transactions should never be a “set it and forget it” scenario. As with all your other financial accounts, you should regularly log in and check up on balances and transactions in PayPal. Fraudsters who gain access to your PayPal account often start off by testing your account with a series of small transactions. If those are successful, they move on to bigger transactions that can clean out your account in the blink of an eye. If you are keeping a close eye on your account, you’ll notice suspicious activity early and can act on it quickly. It only takes a few seconds to access your account and notice any irregularities. Get in the habit of doing this regularly, and you can nip a potential issue in the bud before it turns into a very big problem.
9. Use a VPN
One of the best ways to protect your PayPal account, especially if you must access it when you’re away from the security of your home network, is to use a Virtual Private Network (VPN). A VPN encrypts all the data you send online, adding an extra level of security for all your online transactions, including accessing and using your PayPal account. A VPN is especially handy when you are traveling and hop on a free hotspot. While we already cautioned against using public Wi-Fi to log in to your PayPal account, there are times when you have no other option. The most common scenario is that you are in another country, and don’t want to incur roaming charges for using mobile data. A VPN allows you to stay secure while using a public network. If you’re shopping for a VPN, check out our latest reviews on the best VPNs on the market today. If you’re in a hurry and don’t have time to compare options, we recommend ExpressVPN. With thousands of servers all across the globe and a host of security-focused features, this is our favorite VPN for PayPal. It’s also one of the best ways to protect yourself against common PayPal scams.
Other Considerations When Using PayPal
PayPal is a safe and highly efficient way to send and receive money around the world. However, it is not a replacement for a bank account or credit card. Instead, it should be considered a complementary way to move money to and from other PayPal users. There are a few reasons for this.
Your PayPal balance is not insured. This is unlike regular bank accounts (in the United States, the United Kingdom, and the European Union). Should PayPal collapse, any money you have in your account may also simply disappear. Customer service is not on par with that of other financial institutions. The internet abounds with horror stories from PayPal users who struggled to find help when a problem arose with their accounts. Although PayPal offers multiple ways to contact them for customer service, the results are often frustrating and inconsistent. It can take weeks or months to resolve disputed transactions. Whether it is the buyer disputing a transaction or PayPal flagging a transaction as suspicious, the review process can sometimes drag on with no explanation. During that time, the amount in dispute (and sometimes your entire account balance) will be frozen and inaccessible to you.
Although these scenarios are unusual, they do happen from time to time. They are worth noting when you decide how you want to use PayPal.
Final Thoughts
PayPal works hard to ensure a robust and secure online financial transaction platform. They use a variety of means to keep their systems safe from hackers. The platform also offers users additional features to further secure their accounts. PayPal users can also take other steps to keep their individual accounts safe. PayPal is one of the easiest ways to send and receive money almost anywhere in the world. With vigilance and proper security habits, your PayPal account will be safe and well-protected. They offer a Seller Protection service that protects against chargebacks, reversals, and related fees. It also protects against unauthorized transactions and claims for items not received. PayPal also offers 24/7 monitoring to quickly identify suspicious transactions. When problems with a transaction arise, PayPal offers dispute resolution services. In addition to shielding your financial information, PayPal also monitors all accounts 24/7 to identify any suspicious activity. They encrypt all data to keep your online transactions safe and secure, and offer dispute resolution services when there is an issue with a transaction. Here are nine ways to protect your PayPal. However, it is recommended to avoid linking your PayPal account directly to your bank account. This is because, should your PayPal account somehow be accessed by fraudsters, they will have direct access to the money in your bank account. This risk is avoided when you link your PayPal account to a credit card, instead. Of course, if you don’t have a credit card, then your bank account or debit card are the only viable alternatives. In this scenario, be sure to take extra precautions to secure your PayPal account. Also, when you link to a credit card rather than your bank account, you avoid putting your bank balances at risk. It’s also one of the best ways to protect against PayPal scams.
