Guide to PayPal Under 18: Age Limits & Alternatives

Understand PayPals under 18 age limit. The alternatives available such as prepaid debit cards, and how they can help teach kids important financial lessons.
Colby Brin
May 17, 2023
min read

PayPal is a financial service that allows people to make purchases more securely.

Instead of sharing sensitive financial information online – a.k.a. your card details – you can use a PayPal account to make secure payments and protect the funds in your bank account.

All you need to do is connect your bank account to your PayPal. Then, you can deposit and withdraw funds from your account with the click of a button. PayPal has extensive anti-fraud and encryption capabilities to keep financial details from linked bank accounts safe.

You can also pay others and receive payments through your PayPal account – more quickly than direct bank transfers, especially for international payments. This feature appeals especially to children and teens with small businesses. But how old do you have to be to have PayPal, and can you open an account as a child or teen, or do you have to be 18 to use PayPal?

You might be considering opening a PayPal account, as a child or as a parent for their child, to make online purchases securely, be able to pay cashless without opening a bank account and make and receive payments seamlessly.

PayPal has several restrictions on who they allow to set up PayPal accounts, including age restrictions on those who open a PayPal account. So how old do you have to be to have PayPal, and do you have to be 18 to use PayPal?

Do You Have to be 18 to Use PayPal

You must be 18 to register for a PayPal account. You can’t legally register for an account on PayPal under 18. If PayPal discovers you’re a minor, it will close the account.

Having said this, those under the age of 18 can still use the PayPal account of their parents, with permission, when making a purchase online. However, there are better alternatives to PayPal for children and teens who want to manage their own finances.

Why Does PayPal Have a Minimum Age

After finding out that you can’t use PayPal under 18, you might be wondering why.

Accepting the terms and conditions of PayPal constitutes a binding legal contract – which anyone under the age of 18 is unable to do legally. This creates liability problems for PayPal.

Because 18 is the legal contract age, children under 18 can’t be held accountable by the contract, effectively making it void. Since they can’t legally be held responsible for violating PayPal’s terms and conditions, the company has established that you can’t have an account on PayPal under 18.

PayPal for Kids: What Alternatives Are Available

Though you can’t use PayPal under 18, there are several alternatives that children and teens can use to make purchases online, shop at card-only retailers, and manage their money.

Remember that when giving your child any degree of financial freedom, you should educate them on money management. We’ll cover why this is important later in the blog.

For now, here are some alternatives you might be considering – including whether they’re possible PayPal alternatives for kids.

1. Prepaid debit card for kids

A prepaid debit card is one of the safest, most secure alternatives to PayPal for a child. Kids prepaid debit cards, for kids aged six and above, are like regular debit cards, but your child can only spend what they have.

This means they can buy things online or at cashless retailers without overspending or going into an overdraft. Giving your child a debit card is also safer than cash for multiple reasons. In large part because your child is less likely to lose their card or have it stolen, and if they do, they can protect their money by freezing their account.

With the HyperJar prepaid credit card, kids can also use the HyperJar app to view their savings, track their spending, and even practice budgeting by storing their money in virtual ‘jam jars’ that help them save for the things they want. HyperJar makes this fun as kids can customise the jars and set savings goals to strive for.

Kids’ prepaid debit cards allow children to get used to using a card to shop and allow them to buy from cashless retailers. Pairing this with the HyperJar app encourages them to build saving and budgeting habits, which will help them to develop the financial skills needed to use a PayPal account responsibly at 18.

Check out our ultimate guide to debit cards for kids to find out more.

2. Online Bank Accounts

Children can open an online bank account and deposit, withdraw, and make purchases with their accounts from 13.

They can also open an ‘instant access’ children’s savings account with a regular bank, though some banks won’t offer online banking functionality for minors. A child can open a children’s savings account from the age of 7, though this differs between banks.

Much like a prepaid debit card, with these types of accounts, your child or teen will be able to spend money they have – but won’t be able to spend more and go into an overdraft.

3. Teen credit cards

Much like having an account on PayPal under 18, you can’t own and use a credit card before you’re legally an adult since you must enter a legal, financial contract with the provider.

Since children and teens can’t use credit cards, prepaid debit cards for kids aged 6+ are a great alternative. Though it won’t boost your child’s credit score (there’s plenty of time for that later), it allows them the freedom to spend money online and offline and practise financial habits like budgeting and saving.

Teaching Kids Financial Responsibility

It’s never too early to begin teaching kids to be financially responsible. In fact, financial literacy and having an early financial education have been correlated with high net worth in multiple studies.

Encouraging your child to play educational money games and educating them about the importance of saving, budgeting, and investing is important. However, the best way to learn is by doing.

You might have been wondering how old do you have to be to have PayPal, or do you have to be 18 to use PayPal, because you want your child to have the tools to manage their own money.

However, you can do this with a prepaid debit card and app that allows them to practise saving and budgeting in a risk-free space. While this gives children a sense of independence now, early financial education and money management skills can have incredible benefits for their future.

As a parent, you can integrate the pocket money you give your child as part of their financial education, encouraging them to save and not spend all the money they earn at once. This prepares them for when they make money as a child or teen, teaching them the restraint they need to not spend their earnings immediately.

HyperJar’s Prepaid Debit Card for Kids

Kids can’t register for an account on PayPal under 18. So, they’ll have to wait until they’re a legal adult to register for a PayPal account and begin using it to make purchases.

However, several alternatives allow children to manage their money – to make purchases online and at cashless retailers and to securely send and receive payments online.

The HyperJar kids prepaid debit card and app give kids more control of their finances, expands their shopping options, and enables them to practise vital financial habits like saving and budgeting that will set them up for life. Visit the HyperJar site to find out more.

Colby Brin

Head of Copy

Colby Brin is Head of Copy at HyperJar. With over 17 years of professional writing experience, Colby’s been a journalist, ghostwriter, language consultant, and writing trainer. Having previously served as Head of Copy at Wise, he’s worked in fintech for over six years. A native of New York City, Colby graduated from the University of Michigan, and has lived in London for two years.

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