PayPal charges differently depending on how you move money out
PayPal does not charge a fee when you transfer money from your PayPal balance to a linked bank account using their standard transfer option. The transfer itself is free, but it takes one to three business days to arrive. If you want the money faster, PayPal offers an when ready transfer option that does charge a fee — usually between 1% and 2% of the amount you send, with a minimum fee of around 25 cents.
The exact fee for when ready transfers varies based on your account history and the payment method you link. A brand-new account might pay 2%, while an established account with a good history might pay 1%. PayPal shows you the exact fee before you confirm the transfer, so you always know the cost before your money leaves.
There is one situation where a standard transfer can cost money: if you transfer to a debit card instead of a bank account. Debit card transfers are when ready but charge a fee of around 1.5% to 2%. Again, PayPal displays this fee before you complete the transfer.
Key Takeaways
- Standard transfers from PayPal to a linked bank account are free and take one to three business days.
- when ready transfers to a bank account cost between 1% and 2% of the amount, depending on your account age and history.
- Transfers to a debit card are when ready but always charge a fee of around 1.5% to 2%.
- PayPal shows you the exact fee before you confirm any transfer, so you can decide whether the speed is worth the cost.
How standard transfers work and why they are free
A standard transfer moves money from your PayPal balance to a bank account you have already linked and verified. PayPal takes one to three business days to process it because the money travels through the banking system, not through PayPal's own network. Since PayPal is not paying for expedited processing, they do not charge you.
To use standard transfer, you need a bank account already connected to your PayPal account. If you have not linked one yet, you will need to provide your routing number and account number, and PayPal will verify the account by depositing two small amounts (usually under a dollar each) that you then confirm. This verification step takes a few days but only happens once.
Standard transfer is the cheapest option if you are not in a hurry. Many people use it for regular withdrawals of money they have earned or received through PayPal.
When when ready transfer makes sense and what it costs
when ready transfer moves money to your bank account within 30 minutes, but PayPal charges a percentage of the amount you send. For most accounts, this fee is between 1% and 2%. On a $100 transfer, you might pay $1 to $2. On a $1,000 transfer, you might pay $10 to $20.
The fee depends on your account history. A new account typically pays the higher rate (around 2%), while an account that has been active for months or years and has a clean record might pay the lower rate (around 1%). PayPal does not publish exactly how they calculate this, but the pattern is consistent: older, more established accounts pay less.
when ready transfer is worth the cost if you need the money urgently — for example, to cover an unexpected expense or to move money before a important date. For everyday withdrawals, standard transfer is almost always the better choice.
Transferring to a debit card instead of a bank account
PayPal also lets you transfer directly to a debit card linked to your account. This is always when ready, but it always costs money — usually around 1.5% to 2% of the amount. Unlike when ready bank transfers, there is no cheaper option if you wait longer.
Debit card transfers are useful if you do not have a bank account or if your bank account is not yet verified. However, if you have a choice between a debit card transfer and a standard bank transfer, the bank transfer is free and only takes a few days, so it is almost always the better option.
How to set up a bank account for transfers
Before you can transfer money out of PayPal, you need to link a bank account. Log into your PayPal account, go to the Wallet section, and select "Link a bank account." PayPal will ask for your routing number and account number — you can find both on a check or by logging into your bank's website.
After you provide this information, PayPal deposits two small amounts into your account (usually less than a dollar each). This takes a few days. Once the deposits arrive, you log back into PayPal, go to the same section, and confirm the two amounts. After you confirm them, your account is verified and you can transfer money whenever you want.
This verification step only happens once. After that, you can transfer to this account as many times as you want without any additional setup.
What happens if you do not have a bank account
If you do not have a bank account, you can still move money out of PayPal, but it will cost you. Your options are a debit card transfer (1.5% to 2% fee) or a PayPal Cash Card, which is a debit card issued by PayPal that you can load money onto.
The PayPal Cash Card itself is free to get and free to use once you have it. However, loading money onto it from your PayPal balance is treated as a transfer, so it may carry a fee depending on how you do it. If you are considering this route, it is worth opening a bank account instead — most banks offer free checking accounts with no minimum balance, and once your account is verified with PayPal, transfers are completely free.
Fees you might see that are not transfer fees
PayPal charges fees for other things that are separate from moving money to your bank account. If someone sends you money using PayPal's friends and family feature, there is no fee. If someone sends you money as a payment for goods or services, PayPal takes a percentage (usually around 2.9% plus 30 cents) from the money you receive — this happens automatically and you see the net amount in your balance.
These payment processing fees are different from transfer fees. A transfer fee is what you pay to move money out of PayPal. A payment fee is what PayPal takes when money comes in. Both can explore to the same transaction if you receive a payment and then transfer the money out, but they are separate charges.
Frequently Asked Questions
Can I transfer money to someone else's bank account?
No. PayPal transfers only move money from your PayPal balance to a bank account in your own name. If you want to send money to someone else, you use PayPal's send money feature, which is different from a transfer. Sending money to another person may carry a fee depending on the payment method they choose to receive it.
Why does my transfer say it will take three days when the bank is only closed one day?
PayPal counts business days, not calendar days. A transfer started on a Friday might not arrive until the following Tuesday because the weekend does not count. If you start a transfer on a holiday, that day does not count either. Standard transfers take one to three business days depending on your bank and when you start the transfer.
What if I transfer money and then change my mind?
Once a transfer is started, you cannot cancel it if it has already been processed by PayPal. Standard transfers can sometimes be canceled within a few minutes of starting them if you act quickly. when ready transfers cannot be canceled once they are sent. Check your PayPal transaction history to see the status — if it still says "pending," you may be able to cancel it.
Do I have to pay tax on money I transfer out of PayPal?
The transfer itself is not taxable — you are just moving money you already have. However, the money in your PayPal account may be taxable depending on where it came from. If you earned it through work or sales, it is taxable income. If it was a gift or a refund, it may not be. PayPal is not responsible for your taxes, but they do report certain transactions to the IRS.
Is there a limit to how much I can transfer at once?
PayPal sets limits on how much you can transfer, and these limits depend on your account age, history, and verification status. New accounts have lower limits than established ones. You can see your limit by starting a transfer — PayPal will show you the maximum amount you can send. If you need to transfer more, you can do multiple transfers or contact PayPal support.