Earn Interest on Your PayPal Balance

Written by Nickel - 5 Comments

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Here’s a quick money earning tip… If you’re carrying a balance in your PayPal account, make sure that you’re earning interest… While PayPal offers a ‘Money Market’ account that’s currently paying 4.98%, the default setting is for you to earn no interest whatsoever. While I wouldn’t use this as a substitute for a bank account due to the lack of FDIC insurance, as well as PayPal’s reputation for freezing accounts first and asking questions later whenever a dispute arises, there’s no reason not to earn a bit of interest on whatever you have lying around in your account. So hop on over to PayPal, log in, and poke around for info on how to upgrade your account.

Published on July 24th, 2006 - 5 Comments
Filed under: Banking, Online
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About the author: Nickel is the founder and editor-in-chief of this site. He's a thirty-something family man who has been writing about personal finance since 2005, and guess what? He's on Twitter!

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Comments (scroll down to add your own):

  1. Actually I’ve heard some pretty scary stories about PayPal customer service regarding their pseudo-bank accounts.. for my take, I’d rather just transfer the money out. You can link your HSBC or ING account to your PayPal account and transfer it back and forth whenever you want.

    Comment by Kira — Jul 24th 2006 @ 12:01 pm

  2. As an ebay seller, I hate to leave money in my PayPal account for fear of a charge-back. If my account is empty, I have a layer of protection should PayPal decide to raid my account for a charge-back without my having a chance to look into the issue.

    Comment by Daytonscott — Jul 24th 2006 @ 12:36 pm

  3. Is paypals interest just 4.98% or is it APY?

    Comment by jay — Oct 17th 2006 @ 9:16 pm

  4. Not in the UK! Bastards. (Not that the UK is doing interest on savings, itself, at time of writing!).

    Comment by Harry — Apr 19th 2009 @ 9:33 pm

  5. Paypal sucks horribly. I’ve had my account debited by them numerous times. They will seize funds out of your account on a whim if a customer has nay issue at all. Take the money, ask questions alter.

    I NEVER carry a balance, you might find yourself not getting your money back.

    If there was an alternative I’d dump Paypal in a second.

    Comment by Devlin — May 20th 2009 @ 6:14 pm

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