I have a PayPal account that is linked to my Mastercard debit card, which is linked to my bank account. I usually make online payments using PayPal instead of directly using the debit card. PayPal then charges the debit card after I spend money using the PayPal account. Flow of money: bank account → debit card → PayPal → merchant. I used PayPal because I believed that it is somehow safer than using the debit card directly. Is this true? Are online payments using PayPal safer than using a debit card?
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Depends on what you mean by "using the debit card directly". Would you enter your card details directly into the order form on the merchant's website, or would you be redirected to a website of a bank/card processor which would then ask for your card data (a 3-D Secure setup)? In some parts of the world, the latter is pretty much the norm, in other places it's rare at best.– TooTeaAug 16, 2022 at 13:32
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@TooTea I would enter the debit card details directly in a form on the merchant's website. Sometimes, after entering the debit card details, the merchant's website would open a new tab or embed a form from my bank where I am asked to fill in the two-factor authentication code that the bank sent to my phone using SMS.– FluxAug 16, 2022 at 13:41
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1 Answer
Are online purchases using PayPal safer than using a debit card?
Probably.
You already have your debit information saved within Paypal's systems.
Using that card directly at a merchant's site would mean that you would now have that debit information stored on Paypal and the merchant's site. A data breach on either site would now potentially compromise your debit information. Paypal, being a major financial institution, presumably has better safeguards against a data breach compared to many online merchants.
Generally, it is safer to pay using PayPal, as your card information is never transmitted to or stored by the merchant, thus lowering the attack surface for your debit information being compromised.
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@ sf02 "your card information is never transmitted to or stored by the merchant"... I used to think so too, but at one point I purchased something through AliExpress via PayPal, and had an extra charge tacked on because, according to my CC's bank the merchant in Shanghai put it through as a cash advance instead of a charge. So I'm not convinced of PayPal's usefulness as a secure 'buffer'...– BobTAug 16, 2022 at 21:10
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@BobT Not sure how the merchant making an extra charge (for whatever reason) meant that they received your CC information from Paypal.– sf02Aug 17, 2022 at 19:37
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@ sf02 The merchant didn't make the extra charge. The bank did because the merchant put through the purchase as a cash advance, not a charge... I'm not sure how that could have happened if Paypal was buffering the transaction.– BobTAug 18, 2022 at 2:20