Paypal on a smartphone

Shop with Paypal and earn rewards points

Earn reward points while shopping online with PayPal account and get the benefit of an easier and more secure checkout option.

Online shopping has become an intrinsic part of our lives. It is growing at a brisk pace and an increasing number of customers are using the convenience of online shopping to buy different types of goods. This reduces the purchases made in the store and also reduces the reward points earned on the credit cards.
However, it is still possible to earn an equal amount of reward points while shopping online when one uses PayPal.
‘Each time you buy online with PayPal, you can choose which funding source linked to your account you want to pay with – such as your credit card, bank account or PayPal credit’ says Adrian Christie, PayPal Australia Spokesperson. ‘PayPal stores all your financial information securely online so all you need to check-out is the email address and password linked to your PayPal account. In order to earn points simply choose which card to use each time you check-out which saves you from reaching for your wallet to look for the right card for the relevant retailer.’

What is PayPal?

PayPal is an online alternative to the traditional money transfer method of cheque and money orders. Customers can send and receive funds without revealing their financial details to the merchant, making the transaction more secure. Currently there are 5.6 million active customers in Australia shopping with PayPal.
It processed over US$228 billion in 2014 across 190 nations. Besides its global reach, the major attraction for this payment route is that a majority of merchants have accepted processing transactions through PayPal. This provides customers with a single checkout mechanism which is safe, fast and provides the ability to use the credit cards to collect reward points.

How can I gain points on my credit card through PayPal?

Multiple credit cards can be linked to a PayPal account. After selection of the products, customers can choose an appropriate credit card in PayPal checkout on which they would gain the maximum rewards. PayPal provides a single account within which one can store the credit card details and use the cards which are ideal for the purchase made. Therefore, if you use your rewards credit card to pay for eligible purchases online via PayPal, you can accrue points while shopping online.

How does it work?

Purchases made in the online store through PayPal are now similar to the purchases made in the brick and mortar stores. Customers using multiple credit cards can use the card which would give them the maximum benefit while making a purchase. This is possible through a single PayPal account and there is no need to enter the financial details of the card every time one makes a purchase.
Online retail growth has been in double digits for the past several years and one of the reasons for it is the deep discounts given my online sellers. Collecting rewards on online purchases is the icing on the cake for customers using the convenience of PayPal.

What should I be wary of when using PayPal to earn points?

PayPal offers a single account through which most of the purchases in the online medium are possible. However customers should note a couple of points before they switch to PayPal for completing their online transactions:

  • Security. PayPal is accepted as a very safe system for making financial transaction. However customers should ensure certain basic internet safety rules on their end. These include: logging out of the account after using it, making sure that the transaction is processed through the official PayPal site and storing their account login information carefully.
  • Is PayPal accepted? PayPal might not be accepted by the merchant you are purchasing from. Although more and more stores are moving to the online medium and accepting PayPal, there are still a couple of them who do not accept their payments through PayPal.
  • Frequency of purchases. If you do not shop online frequently, than you may not receive the full value of using a PayPal account for purchases.
  • Overspending. Credit cards often result in overspending. Having a PayPal account that is linked to your credit card can lead to problems in the future if you have trouble controlling your shopping cart. Always keep track of the amount you’re spending and remember that although you may have a large credit limit at your fingertips, you’ll have to pay it all back eventually.

Pros and cons of using PayPal to earn rewards points


  • Reward points. PayPal provides the option to earn reward points on purchases in the online marketplace also. This eliminates any loss of reward points that customers would have in shifting from brick and mortar stores to an online store.
  • Security. PayPal hides the financial detail from the merchants which makes the account safe and prevents any fraud or loss in the future.
  • Ease of transaction. All the credit card information is stored in a single account allowing customers to easily choose the card they want for a particular purchase. Having a single account for all purchases makes the transaction easy.
  • Nationwide acceptance. The acceptance of PayPal in the merchant community is very high. There are over 110,000 merchant partners in Australia using PayPal including Jetstar, DealsDirect, Roses Only, JB Hi-Fi, and more.


  • Switching to new platform. This is a drawback for any new platform. If customers are comfortable using a particular system, they might not like to move to another platform. New users will need to make an account and add requisite information about cards into it.
  • Overspending. Using this platform makes the transactions seamless which brings the drawback of overspending with it. Impulsive shopping on this platform can be a major financial setback for customers.

If you regularly use PayPal for online shopping, then linking your account with your rewards credit card could be a great way to earn additional points on eligible purchases. While earning points may be tempting though, don’t let the lure of your PayPal account and credit limit lead to overspending.

Frequently asked questions

The PayPal system is secured through SSL encryption which makes the online transactions very secure. However customers should ensure that they keep the login information carefully and log out of the system after using it.

PayPal accepts a large number of cards including Visa, Mastercard, American Express, Diner’s Club and more. However certain cards are not compatible with PayPal Merchant Services like procurement and private label credit cards.

This system is available everywhere in Australia where you can access the internet. However, not all online stores accept PayPal, so make sure you confirm what payment options are available before committing to a purchase.

Back to top

Shirley Liu

Shirley is's publisher for banking and investments. She has completed a Masters in Commerce (Finance) and is the author of hundreds of articles. She is passionate about helping Aussies make an informed decision, save money and find the best deal for their needs.

Was this content helpful to you? No  Yes

Related Posts

NAB Premium Card - Exclusive Offer
NAB Premium Card - Exclusive Offer

Interest rate


Annual fee

Qantas American Express Ultimate Card
Qantas American Express Ultimate Card

Interest rate


Annual fee

St.George Vertigo Platinum
St.George Vertigo Platinum

Interest rate


Annual fee

NAB Low Rate Credit Card
NAB Low Rate Credit Card

Interest rate


Annual fee


Ask an Expert

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, read the PDS or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms and Conditions and Privacy Policy.

8 Responses

  1. Default Gravatar
    June 14, 2016


    Can you still earn points on the money you send to “Family and Friends” using your credit card as the manner of payment through Paypal?


    • Staff
      MayJune 14, 2016Staff

      Hi Ebony,

      Thanks for your inquiry.

      Generally, credit cards will let you earn points if you use them on eligible purchases and not on cash advances. Since credit card companies view fund transfer as a cash advance, when you send money to your family and friends using your credit card through your PayPal account, you won’t be able to earn points from it.


  2. Default Gravatar
    ashJune 10, 2016

    how can I get into reward program in paypal if I have no credit card and only link with bank account and how can I use that point ?

    • Staff
      AnndyJune 10, 2016Staff

      Hi Ash,

      Thanks for your comment.

      With Paypal, you can only earn points when you link your credit card to your Paypal account. PayPal accepts a number of credit cards including Visa, MasterCard, American Express, Diner’s Club and more. However, it is important to note that certain cards like procurement and private label credit cards
      are not compatible with PayPal Merchant Services.


  3. Default Gravatar
    F.July 21, 2014

    Is there an annual fee to use PayPal???

    • Staff
      ShirleyJuly 22, 2014Staff

      Hi F,

      Thanks for your question.

      At the time of writing there is no annual fee to use Paypal.

      However, certain transactions could incur a fee – such as when buying internationally, a currency conversion fee may apply.


  4. Default Gravatar
    KarenMarch 11, 2013

    Both my bank account and credit card are already linked to my Paypal account. When I use Paypal it takes the money from my bank account. I have followed your directions but can’t find a way to make Paypal take funds from my credit card rather than bank account. Both cards are listed as primary. How do I change from which source funds are taken?

    • Staff
      MarcMarch 11, 2013Staff

      Hello Karen,
      thanks for the question!

      Sometimes when a bank account and credit card are linked to a Paypal account, Paypal will only use the credit card as a back up. One way of fixing this is to physically change your funding option during payment for an item. After you make a purchase, you’ll receive an invoice through Paypal. On this invoice there’ll be a link that displays your payment method, so click the link that says “more funding options”. This will allow you to select your credit card to pay.

      I hope this helps,

Ask a question