Updated January 9, 2015

PayPal Credit Card Review: Worth It?

PayPal's credit card offers perks to lure loyal users. But is it the rewards card you need in your wallet? Read up on the best benefits and a few drawbacks in our guide.

The PayPal Extras MasterCard offers one point for every dollar you spend. You can redeem the points for:

  • Gift cards
  • Travel
  • Merchandise
  • Cash back into your PayPal account

Here's the best part: You get triple the points on dining and gas and double the points when you use the card on a PayPal or eBay purchase.

That's a big plus for those trolling the auction site looking for their next Hello Kitty or Star Wars collectible.

So it the right card for you?

© Tina Franklin (CC BY 2.0) via Flickr


  • Rewards: 3 points for every dollar you spend on gas and restaurants, 2 points for every dollar spent through PayPal and eBay, and 1 point for all other eligible purchases
  • Benefits: All MasterCard Platinum Benefits
  • Annual Percentage Rate (APR): 19.99% or 23.99%, depending on your credit worthiness
  • Annual Fee: None

We'll break down the features below. But first, here are some current credit card promotions you should not ignore.


Reward redemption is tier-based. At the low end, you'll need 800 points to get a gift card from a variety of retailers.

Accumulate 3,000 points and you can redeem them for eligible merchandise. For cash back, you'll need at least 6,000 points, which converts into $50 (roughly 0.83 cents per point). These will be credited immediately to your PayPal account.

You can then transfer that money into your regular bank account if you want. The maximum amount of points you can accumulate in a year is 50,000.

TIP: Link your PayPal Extras MasterCard to your eBay account through PayPal. You'll receive 2 points for every dollar you spend.

To rack up rewards points, it makes sense to pay via PayPal using your Extras MasterCard. That is, unless the debit card or bank account linked to your account nets you more.

How rewarding is it? This card provides a variety of ways to accumulate points. But its formula is not as generous or easy to calculate as other rewards cards that view one point as equivalent to 1% back, or about 1 cent per point.

PayPal's MasterCard points usually translate into less than 1% cent per point. So if you're looking to get the best rewards point bang for your buck, you need to be aware of this lower valuation.

Another factor to consider is that points limit. While it could be a tough threshold to meet and never be an issue for you, it is a limit that many other rewards cards don't have.

PayPal employee shuttle
PayPal employee shuttle © Richard Masoner / Cyclelicious (CC BY-SA 2.0) via Flickr


With the PayPal MasterCard, you'll receive all the benefits offered to MasterCard Platinum customers, including:

  • Extended Warranty: When you use the card on eligible purchases, you'll get double the original manufacturer or retail store warranty for up to a year.

    That means, for example, a year of protection if the original warranty was six months. An initial one-year warranty will net you an additional year.

  • Price Protection: On qualified purchases, you have up to 60 days from the date of purchase to find a lower price and be reimbursed the difference.

  • Purchase Assurance: If an eligible purchase with the PayPal Extras MasterCard is damaged or stolen within 90 days of buying it, you'll receive a refund.

    (Through just PayPal, you have half that amount of time to make a dispute with a purchase).

  • Fraud Protection: With unauthorized charges on your PayPal Extras MasterCard, you won't be liable for a cent.

    If it looks like you're the victim of identity theft, PayPal will help you contact the credit bureaus to assist you with straightening the problem out.

    This feature may give you more confidence using PayPal's service.

Keep reading to learn about travel benefits when using the Paypal Extras Mastercard.


If you pay for qualified travel expenses using the PayPal Extras card, including airfare, hotel, and car rental, here are some of peace-of-mind benefits you'll get:

  • Baggage Delay and Lost Luggage Insurance: You'll be reimbursed for essentials, such as toiletries, if your bags don't arrive at your destination with you.

    And if your eligible luggage never shows up or is damaged, you will be reimbursed for the repair or losses.

  • Car Rental Insurance: Decline the rental car company's collision and damage waiver and pay for your car with the car. You'll automatically be covered for any theft and damage to an eligible rental car.

  • Hotel Burglary Insurance: If you use the PayPal Extras card to pay for your hotel room and one of your eligible personal belongings is stolen, you're covered.

You also get Travel Accident and Trip Cancellation Insurance, which reimburses you if your eligible trip is canceled or interrupted.

Make sure, though, that you read all the fine print as to how much of a refund you'll receive.


Security: PayPal has its security advantages, which is why over 100 million customers use the site.

Fast Processing: You won't have to twiddle your thumbs waiting for a decision on your application. In most cases, you'll have an answer 10 seconds after submitting it.

And you'll instantly be given a temporary credit line to use on your account

Convenience: Hundreds of thousands of merchants allow you to pay via PayPal, So you can easily earn points just by using the service.

Who Is This Card Best For? People who use PayPal on a regular basis, either for purchases or business, should consider this card. This is also true for those who do a lot of eBay transactions via PayPal.


Points Expire: Rewards points expire 24 months after they're issued. You'll also lose your points if you miss two payments in a row or if your card is inactive for a 12-month period.

High Interest Rate: The APR is pretty steep for a general MasterCard. If you carry a balance, this is probably not the card for you. And there's no introductory APR.

Travel Reward Redemption: Travel rewards can only be redeemed when you make a reservation through Loyalty Travel Services, a PayPal business partner. You can't use the points if you don't book through that company.


Depending on your needs, there may be a better card out there for you. Consider:

  • If you carry a balance, look elsewhere: If you know you're going to make monthly payments, you're better off finding a card that offers low interest rates.

    If you have strong credit, you'll certainly be able to find a card with a lower, or even 0%, introductory or overall APR.

  • If you travel a lot: There are several travel and mileage rewards cards that will be better suited for you, as you're not limited to booking a trip through just one website.

  • If you're in school: Look into acquiring a student credit card. These types of cards help you build credit.


The PayPal Extras MasterCard has some useful benefits, especially for those who do a lot of business on eBay or through PayPal.

Consider your spending habits to see if the card is right for you.

Cynthia Cohen is a retail analyst at CreditDonkey, a credit card comparison and reviews website. Write to Cynthia Cohen at cynthia@creditdonkey.com. Follow us on Twitter and Facebook for our latest posts.

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