PayPal’s New Debit Card: 1% Rewards, 20% Boosts… and a Ton of Confusion

In this episode we look at PayPal’s new UK debit card and the PayPal+ rewards scheme. The headline numbers sound great — 1% back, tier boosts, and retailer offers up to 20% — but the rules are messy. We explain how the points really work, where the rewards drop off, and whether any of the tiers are actually worth chasing. Plus, the travel perks are surprisingly strong.

What we cover:

• How PayPal+ points work vs real cashback
• Online vs offline spend differences
• Why PayPal balance matters
• Gold/Black tiers and realistic earning potential
• Retailer boosts and subscription perks
• Travel benefits (FX fees, Mastercard rate, ATMs)
• Whether the card is worth using at all

Connect with us (via LinkedIn)

Jan: https://www.linkedin.com/in/jan-watermann/

Jonny: http://www.linkedin.com/in/jonny-pease

Got a question or topic you want us to cover? Drop us a message at jonny@technicallymoney.com

Transcript

00:00:00:00 - 00:00:08:08
Unknown
Okay. So we have a new cashback debit card here in the UK, and it's safe to say that this provider is trying to get our attention because this offer is very compelling.

00:00:08:08 - 00:00:11:15
Unknown
So PayPal has launched a scheme called PayPal plus

00:00:11:15 - 00:00:17:03
Unknown
and linked it to a debit card that can earn 1% cashback on everyday spending.

00:00:17:03 - 00:00:23:12
Unknown
but that is also only the baseline, because this can potentially scale from 1% to 1.5%.

00:00:23:12 - 00:00:31:10
Unknown
And in terms of like specific retailer bonuses, you can earn as much as 20%. So very, very compelling.

00:00:31:10 - 00:00:39:08
Unknown
However, there are some potential issues. One you need to have like an IQ of 3000 to understand this thing. It's kind of confusing.

00:00:39:08 - 00:00:52:15
Unknown
And two, I think some people will throw up a red flag when they see the name or the brand PayPal, and I think that comes with some potential fear or negativity attached to it.

00:00:52:15 - 00:00:54:22
Unknown
So we're going to talk about all of this today. But first, yeah, I

00:00:54:22 - 00:01:04:08
Unknown
think it's super important that we just outline how you can get 1% from this thing and what are like the high level rewards or potential rewards that we can earn.

00:01:04:08 - 00:01:12:22
Unknown
John, you're absolutely right. PayPal has launched a very attractive Mastercard debit card in the UK. There's one thing I would like to, correct you with, though,

00:01:13:10 - 00:01:14:01
Unknown
Okay.

00:01:14:01 - 00:01:27:14
Unknown
cash back, but, you, you get rewards through a point system. So what happens is you collect one point for every pound that you spend, and that point is worth one penny, when you spend it, through your PayPal account.

00:01:27:16 - 00:01:36:22
Unknown
So what you can't do is you can't just convert that to cash, you know, and then, for example, go to an ATM and withdraw it. It doesn't work. You have to spend it through PayPal.

00:01:36:22 - 00:01:39:06
Unknown
Okay, cool cool cool. And how do we earn these points?

00:01:39:06 - 00:01:48:05
Unknown
Yeah. You can just go ahead, use your card offline, online. And every time you make a transaction and spend money, you you earn cash back.

00:01:48:05 - 00:02:04:21
Unknown
Yeah. And that physical debit card I have ordered, it is free to order. It's on its way. And if you tap that card I've got this right. You could earn does it does it does has this giant. If you if you're okay with the PayPal logo I mean it's like a giant PayPal logo on the front of it.

00:02:04:21 - 00:02:06:13
Unknown
But you also get card details

00:02:06:13 - 00:02:09:11
Unknown
with that. So you could use this virtually. You could spend money online.

00:02:09:11 - 00:02:11:03
Unknown
Is there a difference, though, Yann,

00:02:11:03 - 00:02:14:09
Unknown
between spending online and offline in terms of what you can earn?

00:02:14:09 - 00:02:20:15
Unknown
The can be, really depends on how it's set up. So as you, as you first mentioned, PayPal also launched,

00:02:20:15 - 00:02:26:02
Unknown
loyalty program called PayPal plus, and, the loyalty program and the debit card go hand in hand.

00:02:26:02 - 00:02:27:04
Unknown
they're connected. So,

00:02:27:04 - 00:02:37:21
Unknown
basically, if you, if you go ahead, make an online transaction and you have, for example, 5 pounds in your, you know, PayPal balance, you want to want to purchase a group that's worth 10 pounds.

00:02:37:21 - 00:02:44:12
Unknown
can earn the whole point for every pound on those, those 5 pounds that you have have stored in your PayPal balance for everything.

00:02:44:12 - 00:02:52:20
Unknown
That has to be charged from your from your link card, for example, or your, your bank account, depending on how your PayPal account is set up. You only earn 0.1%.

00:02:54:10 - 00:03:00:21
Unknown
Okay. But it makes sense. Just just simply put,

00:03:00:21 - 00:03:13:09
Unknown
if you want to earn the maximum reward, let's just call it 1% cashback or the best possible value that you can derive from your spending, you've got to make sure that the money is deposited inside of your PayPal account. Inside the app.

00:03:13:09 - 00:03:18:02
Unknown
know what's funny Johnny. That doesn't really apply to offline spending. So

00:03:18:02 - 00:03:19:21
Unknown
Okay.

00:03:19:21 - 00:03:29:12
Unknown
offline, really doesn't matter what your PayPal balances are, you still earned, the whole cash back, even if it has to tap into your bank account or to your into a linked, you know, credit card.

00:03:31:15 - 00:03:40:15
Unknown
Right. Okay, okay. I don't wanna jump too far ahead, but do you think that's because people are making money on the transaction, so they're able to afford to offer you the best possible bonus?

00:03:40:15 - 00:03:43:10
Unknown
good question. Possibly. I mean,

00:03:43:10 - 00:03:46:22
Unknown
kind of would make sense, right? Because what we know is that,

00:03:46:22 - 00:03:51:17
Unknown
merchants have to pay for, for debit card transactions are relatively low compared to credit cards.

00:04:10:18 - 00:04:18:09
Unknown
do that through PayPal. So that increases the demand for PayPal checkout. And they earn I believe it's 3% on that.

00:04:18:09 - 00:04:25:03
Unknown
okay. So they're funneling more or trying to funnel more people into using PayPal checkout because that's how you redeem these points.

00:04:25:03 - 00:04:41:13
Unknown
That's something to be aware of as well. There are there are tiers. This is where things also get a bit more complicated. Right. Yeah. Because we have tiers a little bit like an airline rewards program where the more money you spend, the more the more your points are worth.

00:04:41:13 - 00:04:45:21
Unknown
You go up, you go up in the tiers and like British Airways, it begins with blue.

00:04:45:21 - 00:04:54:14
Unknown
That's where everyone starts. But after you've earned 25,000 points, you enter the gold tier and 50,000 points will enter the black tier.

00:04:54:14 - 00:04:55:01
Unknown
There are

00:04:55:01 - 00:04:57:12
Unknown
opportunities to earn more points in those tiers.

00:04:57:15 - 00:05:07:00
Unknown
One of them is you. When you went to gold, you qualify for the subscription, cashback or perk where you can earn points from being subscribed to stuff.

00:05:07:00 - 00:05:07:23
Unknown
correct me if I'm wrong.

00:05:07:23 - 00:05:14:21
Unknown
Yeah, but I think you can earn up to 16.66 pounds in subscription cash back on gold.

00:05:14:21 - 00:05:17:15
Unknown
Blue minik. This is when it gets confusing

00:05:17:15 - 00:05:19:05
Unknown
and oh

00:05:19:05 - 00:05:20:08
Unknown
blooming heck.

00:05:20:08 - 00:05:24:01
Unknown
Okay okay, I'm going to I'm going to go back on that.

00:05:24:01 - 00:05:30:17
Unknown
So if you're on the gold tier, for example, with subscription cashback you can earn up to 12.50 pounds per month.

00:05:30:20 - 00:05:32:01
Unknown
Oh god.

00:05:32:01 - 00:05:36:00
Unknown
And then on the black tier you can earn 16.66 pounds per month.

00:05:36:00 - 00:05:48:22
Unknown
also have something known as the first Friday bonus that you can qualify when you've got gold and black status. That's where you can earn a thousand points from spending 10 pounds on the first Friday of each month. And that doubles with the black tier,

00:05:48:22 - 00:05:49:09
Unknown
I don't think.

00:05:49:09 - 00:05:55:22
Unknown
Yeah, we need to go into too much detail with these tiers, mate, because quite frankly, it's going to be really bloody hard for someone to qualify.

00:05:55:22 - 00:05:58:06
Unknown
So to get gold, you're going to need to spend 25 grand

00:05:58:06 - 00:06:04:04
Unknown
at least accumulate 25,000 points. So that's not going to be exactly, but you're going to have to get close to that.

00:06:04:04 - 00:06:08:08
Unknown
And then for black, you're going to spend 50,000 pounds or or thereabouts.

00:06:08:08 - 00:06:13:19
Unknown
have have that level of card spending, let's be let's be realistic. Johnny. You can probably look at

00:06:13:19 - 00:06:17:09
Unknown
Don't do it with PayPal.

00:06:17:09 - 00:06:18:13
Unknown
other credit cards, rewards

00:06:18:13 - 00:06:19:07
Unknown
Oh.

00:06:19:07 - 00:06:21:17
Unknown
that offer, an even higher cashback ratio.

00:06:21:17 - 00:06:24:19
Unknown
I mean, you got to spend four grand a month to hit that 50 K at least.

00:06:24:19 - 00:06:33:22
Unknown
And that's that's only using your card. Right. So your rent, very likely, or your mortgage will likely not even apply to that. I mean, I don't know how to pay

00:06:34:00 - 00:06:34:09
Unknown
And,

00:06:34:09 - 00:06:35:15
Unknown
using a card. I mean,

00:06:36:00 - 00:06:36:05
Unknown
maybe

00:06:36:05 - 00:06:39:10
Unknown
no,

00:06:39:10 - 00:06:50:18
Unknown
I mean, there are I mean, I've done it. I've done it between my wife and I. It's like a family card. But these are American Express's our main spending card. We can do it. But, you know, in in individually may. Wow.

00:06:50:18 - 00:07:08:19
Unknown
know, if you just think about doing that with an American Express card where, say, you could accumulate loads and loads of Avios points, the redemption value is going to far exceed if you're getting like business class or first class seats, for example, it's going to far exceed the redemption value that we can see at PayPal, which is, one what is it, 1 pound per point?

00:07:12:20 - 00:07:13:04
Unknown
Or

00:07:13:04 - 00:07:17:08
Unknown
one point per pound per minute? Sorry, I'm getting confused. I'm getting confused here.

00:07:20:00 - 00:07:30:00
Unknown
There are a couple of bonus opportunities that I mentioned at the beginning where you can earn, say, up to 20%, I notice. Yeah. And if you want to buy your clothes from George

00:07:30:00 - 00:07:31:02
Unknown
Newcomb,

00:07:31:02 - 00:07:32:18
Unknown
they're offering up to,

00:07:32:18 - 00:07:39:14
Unknown
I think 20% extra points is what they call it. So that's just one example. There'll be lots of retailer opportunities like that in the app.

00:07:39:14 - 00:07:52:07
Unknown
got a source, John Lewis, Debenhams or retailers in the UK. There's loads of cargo as well, which is possibly one that you would use frequently, but so far because I'm not sure if I'm going to commit to this, but so far the best thing.

00:07:52:07 - 00:08:06:04
Unknown
Yeah, that I've derived from, from testing is a free subscription to Perplexity Pro. I don't know why, but it's just an advert on there. It's probably just a data capture tool, but there was a 12 month free subscription. All I had to do was enter my email

00:08:06:04 - 00:08:15:18
Unknown
Very compelling, if you ask me. Probably the the best, best option here. What I can recommend is to keep an eye on these bonus offers because with other, other cards you can change. Right. So,

00:08:16:13 - 00:08:17:05
Unknown
Yeah.

00:08:17:05 - 00:08:23:15
Unknown
better ones coming later down the road. As we just mentioned, the PayPal card was just introduced, very recently.

00:08:23:15 - 00:08:31:01
Unknown
So, maybe if you're listening to this podcast episode in a, in a few months, maybe they're totally different bonus offers available.

00:08:31:01 - 00:08:51:19
Unknown
Yeah, I know, I've just jumped. I'm jumping back a little bit, but I'm sorry, because the whole thing has been quite confusing for my simple brain, but I didn't mention that there were multiplier tiers, did I, on gold and black. So you can earn effectively more cashback when you qualify for those tiers. Goes from one to, 1.2, I think for gold.

00:08:51:19 - 00:08:57:08
Unknown
Yeah, I think you can earn 1.2 points per pound with gold and 1.3 with black.

00:09:00:11 - 00:09:06:18
Unknown
Have I already you? Are you kidding me? I did all that. I don't even remember. Sorry if I've already mentioned that,

00:09:06:18 - 00:09:26:21
Unknown
but one of the things that I can really easily explain to you and get my head around are the effects rates on this thing, right? Yeah. Because it is essentially a really good travel card. You get like if you spend if you spend with this card abroad, internationally, which is international spending and PayPal have never been a good thing, like sending money internationally with PayPal is right, but it's awful.

00:09:26:21 - 00:09:34:02
Unknown
The fees are some of the worst, like they're in the Hall of Shame, but they've just turned it around here, mate.

00:09:34:02 - 00:09:43:17
Unknown
have. So no, of course fees, no cross-border fees. And you're getting Mastercard's exchange rate. Can't get much better than that, can it? And also, no

00:09:43:23 - 00:09:44:16
Unknown
Not.

00:09:44:16 - 00:09:51:09
Unknown
decide to withdraw money, anywhere in the world. Right. So that's that's already better than what Revolut has to offer. For example.

00:09:51:09 - 00:09:57:18
Unknown
Yeah, I mean it's it's unbelievable actually. It's really, really good. And you're going to earn you're going to earn points from your spending.

00:10:06:14 - 00:10:40:21
Unknown
Gambling. Damn it, damn it. The pawn shops. Always with the pawn shops that I was planning on going to. One gambling. Gone.

00:10:40:21 - 00:10:41:11
Unknown
I

00:10:42:01 - 00:10:42:14
Unknown
Yeah.

00:10:42:14 - 00:10:43:23
Unknown
transparency. You know.

00:10:43:23 - 00:10:59:10
Unknown
It might help the understanding factor as well. I honestly like researching this thing and trying to get my head around how it works is quite hard. But PayPal make even harder because it's all ambiguous. Like, it's quite difficult to lock down the full details. But I think

00:10:59:10 - 00:11:12:00
Unknown
one of the big things to stress here is just that when you're spending, if you want to earn the most value, you need to make sure that the money's deposited inside the account, inside the PayPal app, so to speak, and you're not spending through the linked card.

00:11:12:00 - 00:11:29:08
Unknown
You can earn points that way, but you're effectively earning point 1% to set a 1%. That's the headline of. Only.

00:11:29:10 - 00:11:40:09
Unknown
Yeah.

00:11:40:11 - 00:11:47:13
Unknown
Yeah, yeah. There are some caveats because you'll be spending with a debit card. So you'll lose it because you can be trying to commit to spending a large sum of money.

00:11:47:13 - 00:11:56:06
Unknown
come with the drawbacks though because you're going to lose section 75 protection, because I'm sure you would typically be using a credit card to make like high value transactions, you lose that.

00:11:56:11 - 00:12:02:05
Unknown
What about PayPal's buyer protection? Yeah. And does that apply?

00:12:02:05 - 00:12:11:01
Unknown
make with that card. At least for for in-store purchases. If you use, use PayPal, you know, PayPal, checkout and you, you use the card through that,

00:12:11:01 - 00:12:11:17
Unknown
should be fine.

00:12:11:17 - 00:12:14:18
Unknown
But that has less redemption value.

00:12:14:18 - 00:12:17:07
Unknown
can you even can you even can you even do that? No.

00:12:17:07 - 00:12:35:07
Unknown
Then you'd be obviously paying with PayPal directly. You can't use PayPal. Check it out. And using a PayPal debit card because you PayPal debit card will be connected to your PayPal wallet. Right? And if you're going ahead and using using PayPal checkout, you automatically spend the money from your PayPal wallet, right? So.

00:12:35:07 - 00:12:36:10
Unknown
Got it. Yeah.

00:12:36:10 - 00:12:38:14
Unknown
To everyone,

00:12:38:15 - 00:12:41:07
Unknown
Does everybody.

00:12:41:07 - 00:12:44:16
Unknown
I don't know if it's us, but, I think this is pretty confusing.

00:12:45:05 - 00:12:46:03
Unknown
Have.

00:12:46:03 - 00:12:51:16
Unknown
to to understand, the whole concept of, to be fair to fresh product. Right. Just entered the

00:12:51:18 - 00:12:52:15
Unknown
Yeah. Yeah.

00:12:52:15 - 00:12:55:15
Unknown
maybe things will, will get more clear, but, few of

00:12:55:17 - 00:12:59:22
Unknown
Yeah yeah.

00:12:59:22 - 00:13:11:10
Unknown
know, there's something on the market yarn that we can compare this to. You know, the trading two on two debit card when it has like those bonuses of 1.5% is arguably more compelling.

00:13:11:10 - 00:13:22:10
Unknown
But as a like for like, I don't think, you know, this feels very market leading doesn't it? For for someone who can understand it.

00:13:22:21 - 00:13:31:01
Unknown
I don't think it's necessarily better than using an Amex credit card when you're redeeming the points through, like an airline like Avios for example,

00:13:31:01 - 00:13:36:07
Unknown
just as a as a debit card in terms of rewards, it's pretty solid.

00:13:36:07 - 00:13:42:02
Unknown
it's totally free. So if you're interested, why not? Why not go ahead and just sign up. I mean, I think that's

00:13:42:02 - 00:13:42:09
Unknown
Yeah.

00:13:42:09 - 00:13:45:00
Unknown
brainer if I, if you ask me. And, unless they start charging

00:13:45:00 - 00:13:45:12
Unknown
Yeah.

00:13:45:12 - 00:13:51:15
Unknown
that card. I don't see any any major downsides. Yes, it's complicated, but, you know, what do you have to lose here?

00:13:51:15 - 00:14:03:04
Unknown
I don't know if they would charge a fee for it because I think they are, like you said earlier, trying to funnel people into using PayPal's checkout system. Right. And that's where they're going to charge the merchants 3%.

00:14:03:04 - 00:14:12:18
Unknown
That's unlikely. But maybe, maybe, maybe it happens. Right. Just keep an eye on your email. Just make sure they don't just just do that. You know, that'll be a classical PayPal move. But it's another story.

00:14:13:10 - 00:14:16:02
Unknown
Yeah. Yeah. That's another story. Yeah.

00:14:24:23 - 00:14:36:16
Unknown
We shouldn't mention at this point in the show that Yann own shares in PayPal, though is. But let's leave that for now. For another of the idea.

00:14:36:16 - 00:14:39:03
Unknown
but what we should say is at this point,

00:14:39:03 - 00:14:50:06
Unknown
make sure you understand what you're signing up for and let us know in the comments! If you were confused at all by any of this, or I used confused as me because I don't know when did things get so remarkably confusing?

00:14:50:06 - 00:15:12:20
Unknown
I'm not sure. So yeah, let us know in the comments. If you're listening to us, please do take this opportunity to rate us on Apple or Spotify. And if you're watching on YouTube, like the video, subscribe. If you want to support Yann and I, we'd love to have you on board. And, yeah, let us know what you make of this PayPal debit card and PayPal plus.

00:15:12:20 - 00:15:13:07
Unknown
Goodbye.