Everything you need to know about the new PayPal Rewards program
At TPG, we are big fans of stacking rewards when shopping online. You should never earn just 1 point per dollar on online purchases, given the abundance of shopping portals and using the right credit card for your purchase.
There's now another option for earning and redeeming points when shopping online. The new PayPal Rewards program, by the payment platform PayPal, functions partly like a shopping portal and partly like a "pay with points" platform.
Let's take a look at this new rewards program to see what it offers for customers when shopping online.
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What is PayPal?
Before we get into the rewards program, let's make sure we all know what PayPal is.
PayPal is an online payment system with a website and an app that you can use to pay participating merchants or to send and receive money — even internationally and across different currencies. When using PayPal, you can add bank accounts, debit cards and credit cards as payment methods and choose which you want to use for each transaction.
Choosing which payment method to use is great when things like quarterly spending bonuses on PayPal purchases roll around, helping you earn the most points possible during your purchase. When paying with PayPal, you can still use shopping portals like Rakuten to add extra points or cash back to your transaction.
The PayPal Rewards program
Until now, PayPal has just been a way to pay when shopping online. As of Oct. 17, however, PayPal Rewards means you can earn and redeem points through PayPal when checking out online. You can now earn rewards with a Safari extension or in the mobile app. The Safari extension is an update to the PayPal Honey browser extension.
When using the PayPal app, you won't be able to click through other shopping portals before making a purchase. Since PayPal's Honey browser extension functions like its own shopping portal, it's unlikely that you will be able to combine PayPal Rewards with other portals like Cashback Monitor, Rakuten or an airline shopping portal. So, make sure to check which program is offering the best return on your purchase.
Depending on the merchant, earning rates can vary from 1% back to 4%, 5% or up to 10% back. This will vary by merchant and promotional offerings which can even change by the day. That means it's worth checking regularly to see if your favorite store has elevated earning rates.
Related: Your guide to maximizing shopping portals for your online purchases
Within the mobile app, you'll see the number of rewards you've earned and can find merchants by category. Or, you can click on the magnifying glass at the top to search for a merchant by name.
At the time of writing, Sephora offers 10% back on purchases through PayPal Rewards. Bloomingdale's has an elevated rate of 8% back, but Walmart offers just 1% back on purchases. From this example, we see that it's worth checking merchants often, and we see that bonus-earning rates can vary widely from one store to another.
You can find these deals by clicking the third icon on the bottom, which looks like price tags. There are no earning limits, so you can earn on every purchase throughout the year.
Redeeming your earnings
There are no airline transfer partners or sweet spots for redemptions with PayPal Rewards. Instead, the aim is flexibility and saving money.
Once you've earned rewards, you can use them toward your next purchase to offset the price. Additionally, you can redeem your rewards as cash back toward your PayPal balance. After the funds move into your PayPal balance, you can transfer them to your connected bank account or send money to someone else through a funds transfer.
Thus, you can use your rewards at PayPal checkout when shopping online or redeem your earnings for cash.
Bottom line
More ways to earn and redeem points when shopping online are always welcome. By stacking shopping portals, the right credit card and now PayPal Rewards, there are multiple ways to double dip or triple dip when shopping online. How much you'll earn with PayPal's new loyalty program depends on what a particular merchant offers that day, so your earning potential will vary.
Once you earn cash back, you can leave it in your Rewards profile to use on future purchases or redeem it into your PayPal balance. From there, you can transfer it to someone else if you owe them money or transfer it to your bank account to use as you please.
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| 4X | Earn 4X Membership Rewards® points per dollar spent on purchases at restaurants worldwide, on up to $50,000 in purchases per calendar year, then 1X points for the rest of the year. |
| 4X | Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year. |
| 5X | New! Earn 5X Membership Rewards® points on prepaid hotel stays booked through AmexTravel.com or the Amex Travel App. |
| 3X | Earn 3X Membership Rewards® points on flights booked through AmexTravel.com, the Amex Travel App, or purchased directly from airlines. |
| 2X | Earn 2X Membership Rewards® points on prepaid car rentals booked through AmexTravel.com or the Amex Travel App and cruises booked and paid through AmexTravel.com. |
| 1X | Earn 1X Membership Rewards® point per dollar spent on all other eligible purchases. |
Pros
- Valuable dining and food-related credits
- Flexible rewards with airline and hotel transfer partners
- Multiple travel and purchase protections
- No foreign transaction fees
- Access to Amex Offers for additional savings (enrollment required)
Cons
- Not as useful for those living outside the U.S.
- Some may have trouble using Uber and other dining credits
- You may be eligible for as high as 100,000 Membership Rewards® Points after you spend $8,000 in eligible purchases on your new Card in your first 6 months of Card Membership. Welcome offers vary and you may not be eligible for an offer. Apply to know if you’re approved and find out your exact welcome offer amount – all with no credit score impact. If you’re approved and choose to accept the Card, your score may be impacted.
- Earn 4X Membership Rewards® points per dollar spent on purchases at restaurants worldwide, on up to $50,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year.
- New! Earn 5X Membership Rewards® points on prepaid hotel stays booked through AmexTravel.com or the Amex Travel App.
- Earn 3X Membership Rewards® points on flights booked through AmexTravel.com, the Amex Travel App, or purchased directly from airlines.
- Earn 2X Membership Rewards® points on prepaid car rentals booked through AmexTravel.com or the Amex Travel App and cruises booked and paid through AmexTravel.com.
- Earn 1X Membership Rewards® point per dollar spent on all other eligible purchases.
- Pay It® lets you tap in the American Express® App to quickly pay for small purchase amounts throughout the month and still earn rewards the way you usually do. Plan It® gives you the option to split up big purchases into equal monthly payments with a fixed fee. You’ll know upfront exactly how much you’ll pay.
- Updated! $120 Dining Credit: Earn up to a total of $10 in statement credits monthly when you pay with the Gold Card at Grubhub (including Seamless), Buffalo Wild Wings, Five Guys, The Cheesecake Factory, and Wonder. This can be an annual savings of up to $120. Enrollment required.
- $100 Resy Credit: Get up to $100 in statement credits each calendar year at over 10,000 qualifying U.S. Resy restaurants after you pay for eligible purchases with the American Express® Gold Card. That’s up to $50 in statement credits semi-annually. Enrollment required.
- $84 Dunkin' Credit: Earn up to $7 in monthly statement credits after you pay with the American Express® Gold Card at U.S. Dunkin’ locations. Enrollment required.
- $120 Uber Cash on Gold: Enjoy up to $120 in Uber Cash annually with your Gold Card. Just add your Card to your Uber account and you'll get $10 in Uber Cash each month to use on orders and rides in the U.S. when you select an Amex Card for your transaction.
- New! As an American Express® Gold Card Member, you can enjoy complimentary Hertz Five Star® Status. Enjoy benefits like skipping the counter at select locations, adding an additional driver at no additional cost*, and vehicle upgrades**. Benefit enrollment and Hertz Gold+ registration are required. *Additional drivers must meet standard rental qualifications and must be a spouse or domestic partner to qualify as complimentary. Other additional drivers subject to fees. **Benefits are subject to availability and vary by location. Additional Hertz program Terms and Conditions including age restrictions apply.
- Take advantage of a $100 credit towards eligible charges* at over 1,300 upscale hotels worldwide when you book The Hotel Collection through AmexTravel.com or the Amex Travel App **. *Eligible charges vary by property. **The Hotel Collection requires a two-night minimum stay.
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- Whenever you need us, we're here. Our Member Services team will ensure you are taken care of. From lost Card replacement to statement questions, we are available to help 24/7.
- No Foreign Transaction Fees.
- Annual Fee is $325.
- Terms Apply.