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Support local small businesses while you shop with PayPal’s Pay with Rewards feature

Oct. 02, 2020
6 min read
Blonde woman holding credit card and using laptop for online shopping
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Now more than ever, flexible redemption options are a valuable commodity with any rewards program. While we talk a great deal about how to maximize your points and miles to book amazing travel experiences, sometimes saving money on everyday purchases is the most practical use for your rewards — especially if it helps you avoid racking up a balance on your credit card.

Many issuers offer a way to use points as a statement credit for eligible purchases, but the process to redeem can be cumbersome and confusing to beginners. Enter Pay with Rewards by PayPal*, which offers an easy way to use your credit card rewards when you checkout with PayPal.

Related: Everything you need to know about PayPal Pay with Rewards

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Using PayPal’s Pay with Rewards feature

Once you log into PayPal, head to the wallet and select “Link a debit or credit card.” You can then add your cards to use while you shop online. Currently, there are five rewards programs you can link to use with the Pay with Rewards feature: American Express, Capital One, Chase (currently live through Chase Pay), Citi and Discover.

American Express Platinum_Montreal
You can connect your credit card rewards programs to your PayPal account to use the Pay with Rewards feature while you shop. (Photo by Isabelle Raphael / The Points Guy)

Then, you simply shop at one of the millions of online stores that allow you to check out with PayPal. And you don’t have to use rewards to cover the entire payment — using rewards toward only a portion of your purchase is an option.

In our evaluation of PayPal’s Pay with Rewards, we found that the redemption rates were on par with other retail redemptions, and we were able to find individual comparison rates with each credit card provider pretty easily on their respective websites.

Related: How to use PayPal with your credit cards

Supporting small businesses with PayPal’s Pay with Rewards

One of the primary drawbacks to many redemption options is the inflexibility of where and when you can redeem rewards. Between blackout dates, specifications on what qualifies as a travel purchase and more, beginners to the rewards game can easily get overwhelmed.

You can use PayPal’s Pay with Rewards feature to help save money while you shop with your favorite local businesses. (Photo by Maskot/Getty Images)
You can use PayPal’s Pay with Rewards feature to help save money while you shop with your favorite local businesses. (Photo by Maskot/Getty Images)

That’s one way PayPal’s Pay with Rewards feature can help alleviate some of that stress. You can use Pay with Rewards at millions of online retailers with PayPal at checkout — no item restrictions, no minimum purchase requirement. Millions of online businesses accept PayPal around the world — many of which are small, local businesses that would benefit greatly.

Using rewards to shop at small businesses can help you save money while supporting local business owners and your local economy. Where traditional redemption options and even other payment programs may limit you to only redeeming at certain big-name retailers, PayPal’s Pay with Rewards feature gives you the freedom to shop where you want. When you check out with eligible credit cards when shopping with PayPal, you can still earn points and miles — and redeem them the way that works best for you.

Businesses to support

Small businesses need support now more than ever. Here are a couple of TPG staffer favorite online retailers that accept PayPal.

Blk & Bold

TPG credit cards writer Madison Blancaflor swears by the specialty coffee and loose leaf teas sold by Blk & Bold. You can even sign up for recurring orders if you know you’ll need that coffee or tea fix on a regular basis. The best part? Blk & Bold donates 5% of its profits to support at-risk youth.

BookPeople

BookPeople is an independent bookstore in Austin, Texas, but you can also browse the store’s selection online to be shipped. The store also offers subscription packages you can purchase as a gift or for yourself — for example, Signed First Club subscription members receive a signed first edition of a hardcover book each month.

The End of All Music

The End of All Music sells new and used vinyl records. This is another small business that has a brick-and-mortar store in Oxford, Miss., but you can browse online, too. You can also sign up for the Record of the Month Club.

Bottom line

According to PayPal, an estimated $59 billion in credit card rewards are earned annually, of which a third go unused. If redeeming for travel isn’t in the cards for you, you may want to look into whether using the Pay with Rewards feature could be a worthwhile venture.

And don’t forget — Pay with Rewards also comes with some shopping perks. When you shop with PayPal, whether with your rewards or not, you can get benefits like PayPal Purchase Protection** and return shipping***. It can be a complicated process to deal with merchants and retailers when a transaction goes wrong — whether your item didn’t ship or got broken in transit — and PayPal’s benefits help give you peace of mind while you shop.

Visit PayPal to learn more about the Pay with Rewards feature and how you can use your credit card rewards to help you save money on everyday purchases from your favorite businesses — big and small.

*Enrollment may be required. Available on eligible transactions. Terms apply.
** PayPal Purchase Protection is available for eligible transactions. Terms and Limitations apply.
***Return shipping on Us requires activation and is available for eligible purchases. Limitations apply.

Featured image by Getty Images/iStockphoto

TPG featured card

Best for the well-traveled foodie
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review
Apply for American Express® Gold Card
at American Express's secure site

Rewards

3 - 4X points
4XEarn 4X Membership Rewards® Points at Restaurants, plus takeout and delivery in the U.S.
4XEarn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X).
3XEarn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.

Intro offer

60,000 bonus points
Earn 60,000 Membership Rewards® points after you spend $4,000 on eligible purchases with your new Card within the first 6 months of Card Membership.

Annual Fee

$250

Recommended Credit

670-850
Excellent/Good
Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

Why We Chose It

There's a lot to love about the Amex Gold card. It's been a fan favorite during the pandemic because of its fantastic rewards rate on restaurants (that includes takeout and delivery in the U.S.!) and U.S. supermarkets. If you're hitting the skies soon, you'll also earn bonus points on travel. Paired with up to $120 in Uber Cash (for U.S. Uber rides or Uber Eats orders) and up to $120 in annual dining statement credits at eligible partners, there's no reason that the foodie shouldn't add this card to their wallet. Enrollment required.

Pros

  • 4x on dining at restaurants and U.S. supermarkets (on the first $25,000 in purchases per calendar year; then 1x)
  • 3x on flights booked directly with the airline or with Amex Travel
  • Welcome bonus of 60,000 points after spending $4,000 in the first six months

Cons

  • Weak on travel outside of flights and everyday spending bonus categories
  • Not as useful for those living outside the U.S.
  • Some may have trouble using Uber/food credits
  • Few travel perks and protections
  • Earn 60,000 Membership Rewards® points after you spend $4,000 on eligible purchases with your new Card within the first 6 months of Card Membership.
  • Earn 4X Membership Rewards® Points at Restaurants, plus takeout and delivery in the U.S., and earn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X).
  • Earn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.
  • $120 Uber Cash on Gold: Add your Gold Card to your Uber account and each month automatically get $10 in Uber Cash for Uber Eats orders or Uber rides in the U.S., totaling up to $120 per year.
  • $120 Dining Credit: Satisfy your cravings and earn up to $10 in statement credits monthly when you pay with the American Express® Gold Card at Grubhub, The Cheesecake Factory, Goldbelly, Wine.com, Milk Bar and select Shake Shack locations. Enrollment required.
  • Choose the color that suits your style. Gold or Rose Gold.
  • No Foreign Transaction Fees.
  • Annual Fee is $250.
  • Terms Apply.
  • See Rates & Fees
Apply for American Express® Gold Card
at American Express's secure site
Terms & restrictions apply. See rates & fees
Best for the well-traveled foodie
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards Rate

4XEarn 4X Membership Rewards® Points at Restaurants, plus takeout and delivery in the U.S.
4XEarn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X).
3XEarn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.
  • Intro Offer
    Earn 60,000 Membership Rewards® points after you spend $4,000 on eligible purchases with your new Card within the first 6 months of Card Membership.

    60,000 bonus points
  • Annual Fee

    $250
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    670-850
    Excellent/Good

Why We Chose It

There's a lot to love about the Amex Gold card. It's been a fan favorite during the pandemic because of its fantastic rewards rate on restaurants (that includes takeout and delivery in the U.S.!) and U.S. supermarkets. If you're hitting the skies soon, you'll also earn bonus points on travel. Paired with up to $120 in Uber Cash (for U.S. Uber rides or Uber Eats orders) and up to $120 in annual dining statement credits at eligible partners, there's no reason that the foodie shouldn't add this card to their wallet. Enrollment required.

Pros

  • 4x on dining at restaurants and U.S. supermarkets (on the first $25,000 in purchases per calendar year; then 1x)
  • 3x on flights booked directly with the airline or with Amex Travel
  • Welcome bonus of 60,000 points after spending $4,000 in the first six months

Cons

  • Weak on travel outside of flights and everyday spending bonus categories
  • Not as useful for those living outside the U.S.
  • Some may have trouble using Uber/food credits
  • Few travel perks and protections
  • Earn 60,000 Membership Rewards® points after you spend $4,000 on eligible purchases with your new Card within the first 6 months of Card Membership.
  • Earn 4X Membership Rewards® Points at Restaurants, plus takeout and delivery in the U.S., and earn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X).
  • Earn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.
  • $120 Uber Cash on Gold: Add your Gold Card to your Uber account and each month automatically get $10 in Uber Cash for Uber Eats orders or Uber rides in the U.S., totaling up to $120 per year.
  • $120 Dining Credit: Satisfy your cravings and earn up to $10 in statement credits monthly when you pay with the American Express® Gold Card at Grubhub, The Cheesecake Factory, Goldbelly, Wine.com, Milk Bar and select Shake Shack locations. Enrollment required.
  • Choose the color that suits your style. Gold or Rose Gold.
  • No Foreign Transaction Fees.
  • Annual Fee is $250.
  • Terms Apply.
  • See Rates & Fees