How to Send A Gift Payment On Paypal

By Andrew Meer

When sending money to friends and family through PayPal, you can avoid any fees by opting to send the payment as a gift provided that you fund the amount through your PayPal balance or bank account. Making gift payments for your online purchases, however, voids PayPal's Purchase Protection program in the case of a fraudulent sale.

Sending a Gift Payment

After signing into your PayPal account, click the Send Money link under the Tools menu. Enter the email address of the recipient into the To field, and then enter the amount that you want to send. Check the I'm Sending Money to Family or Friends option. Click Continue to review your payment, and then click Send Money to make the gift payment.

According to PayPal, funding payments that use a credit card incur fees (2.9% plus $0.30 per transaction); you can decide who pays the fee before clicking Send Money. When making a gift payment to any person residing outside the U.S., you incur a 0.5-2 percent fee when funded with your PayPal balance or bank account, or a 3.4-3.9 percent fee when funded with a credit card. Additionally, PayPal prevents you from making gift payments to any India-based PayPal accounts.