The fee depends on what type of payment you're sending

PayPal doesn't charge a flat rate for every $25 payment. The fee changes based on whether you're sending money to a friend, paying a business, or receiving money as a seller. A $25 payment to a friend costs nothing. A $25 payment to a business or invoice costs $0.99 plus 2.2% of the amount. A $25 payment received by a seller costs $0.99 plus 2.2%.

The reason the fee structure exists is that PayPal handles different types of transactions differently. Payments between friends use your PayPal balance or linked bank account and carry almost no risk to PayPal, so they're free. Payments to businesses or invoices go through PayPal's merchant system, which involves fraud checks and buyer protection, so PayPal charges for that service.

Key Takeaways

  • Sending $25 to a friend through PayPal's "Friends and Family" option costs zero dollars.
  • Sending $25 as a payment for goods or services costs $0.99 plus $0.55 (2.2% of $25), totaling $1.54.
  • The fee structure is the same whether you're paying an invoice, sending a business payment, or using PayPal's standard payment button.
  • International payments to the same recipient types cost more — usually an additional 1% to 4% depending on the destination country.

Friends and Family payments have no fee

If you're sending $25 to someone you know personally — a roommate, family member, or friend — use the "Friends and Family" option in PayPal. This costs nothing. PayPal doesn't take a cut because you're moving money between people you trust, not conducting a commercial transaction.

The tradeoff is that Friends and Family payments don't come with buyer protection. If the person doesn't send you what they promised, or sends you something damaged, PayPal won't reverse the transaction. Use this option only when you trust the person on the other end.

Goods and Services payments cost $0.99 plus 2.2%

If you're paying for something — a product, a service, an invoice — use PayPal's standard payment option, sometimes labeled "Goods and Services." For a $25 payment, PayPal charges $0.99 plus 2.2% of the amount. That's $0.99 plus $0.55, totaling $1.54 in fees.

This fee structure applies whether you're paying through an invoice link, a PayPal payment button on a website, or by entering someone's email address and selecting "Goods and Services." The percentage stays the same at 2.2% regardless of the amount — it's the $0.99 base fee that matters more on smaller payments.

Goods and Services payments include buyer protection. If the seller doesn't deliver, delivers something broken, or the item doesn't match the description, you can file a dispute and PayPal will investigate. This protection is why the fee exists.

International payments cost more

If you're sending $25 to someone outside the United States, PayPal adds an international transaction fee on top of the base fee. The additional cost depends on the destination country and ranges from 1% to 4% of the payment amount.

For example, sending $25 to Canada through Goods and Services would cost $0.99 plus 2.2% ($0.55) plus roughly 1% more for the international fee, bringing the total to around $1.79. Sending to countries further away or with less developed financial infrastructure costs more. PayPal shows you the exact fee before you confirm the payment, so you'll know the total before money leaves your account.

How to see the exact fee before you pay

PayPal always displays the fee breakdown before you confirm a payment. When you enter the amount and select the payment type, PayPal shows you the subtotal, the fee amount, and the total that will be deducted from your account or charged to your card.

If you're paying through an invoice link someone sent you, the fee may already be built into the total, or the invoice may show it separately. Check the invoice details before you pay. If you're sending money directly through PayPal's website or app, you control whether to cover the fee yourself or ask the recipient to pay it — PayPal lets you choose at checkout.

Fees are different if you're receiving money as a seller

If someone sends you $25 through PayPal's Goods and Services option, you receive $23.46. PayPal deducts the same $1.54 fee from what lands in your account. You don't pay this fee separately — it comes out of the money you receive.

Friends and Family payments to you have no fee. If someone sends you $25 as a friend, you get the full $25. This is why some people ask to be paid through Friends and Family instead of Goods and Services — they want to avoid the fee.

Frequently Asked Questions

Can I avoid the fee by using Friends and Family?

Yes, but only if you're not paying for something. If you're sending money for goods or a service and use Friends and Family to dodge the fee, you're violating PayPal's terms. PayPal can limit your account if it detects a pattern of this. Use Friends and Family only for actual personal transfers.

What if I'm sending $25 from my bank account instead of my PayPal balance?

The fee is the same. It doesn't matter whether the money comes from your PayPal balance, a linked bank account, or a debit card — the transaction fee stays $0.99 plus 2.2% for Goods and Services, and zero for Friends and Family.

Do I pay the fee if the payment fails?

No. If PayPal declines the payment or the transaction doesn't go through, you're not charged. You only pay the fee if the payment completes successfully.

Is there a way to send $25 with a lower fee?

Not through PayPal's standard options. Some third-party payment apps like Venmo or Square Cash charge lower fees or no fees for peer-to-peer transfers, but they're separate services. Within PayPal itself, the fee structure is fixed based on payment type.