Martin Lewis warns PayPal users against worrying new trend leaving them open to scams

PayPal allows its users to identify their transactions using different options. This is meant to be used for record keeping purposes but it can leave users in a tricky predicament. According to the Money Saving Expert, a growing trend has emerged which is leaving users open to risk.


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According to their findings, PayPal customers are being encouraged by certain sellers to make payments via the “friends and family” option.

This is being used in replacement of the correct identifier for them which is “goods and services.”

As a result of this, the company’s buyer protection will not cover the transaction.

This means that if something goes wrong with the purchase or sale, the user will have limited rights to deal with it.

According to, there are now signs that scammers are starting to encourage users to take this less secure option.

They detail that, so far, it is unclear why they do this.

However, they believe that it is because it will be harder for shoppers who’ve paid via ‘friends and family’ to get their money back.

It is not just scammers who are benefiting from this. Legitimate traders and businesses are also encouraging the use of the “friends and family” option for dubious reasons.

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If a business is paid through PayPal via the friends and family option, they will not be charged a fee.

This fee will be applicable if the “goods and services” option is selected, which to reiterate, is the option meant for them.

This may seem like a non-issue for consumers if nothing goes wrong but it should be remembered that there will be no reimbursement is things take a turn for the worst. detail that there is one clear and simple response if someone tries to convince a consumer to pay via the wrong option: refusal.


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PayPal has its own protection in place to ensure that no buyers lose out.

If a purchase made through PayPal doesn’t arrive, or doesn’t match the seller’s description they company themselves will reimburse the buyer.

This protection will also offer fraud protection and data encryption for further data security.

As mentioned however, these elements will not be applicable if the wrong options are selected.

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