If you've ever wondered if it's better pay with Bizum or PayPal To send money to your friends, shop online, or earn income as a content creator, you're not alone. Both systems have become part of our daily lives, and although they may seem similar at first glance, in reality They have very different uses, limits, costs, and risks..
Throughout this article you will see, calmly and with very everyday examples, All the advantages and disadvantages of PayPal and Bizum When it comes to sending money, paying online, using them as a payment method, or even for tax purposes, the idea is that, by the time you finish reading, you'll have a clear understanding of when Bizum is the best option, when PayPal is more suitable, and when you might want to combine both or even consider other alternatives like Revolut.
What is Bizum and how does it actually work?
Bizum is a instant payment system between people It was created through the collaboration of almost all Spanish banks. It's not a standalone app, but rather a feature integrated into your bank's app, so that You don't need to download anything extra or open new accounts..
Behind Bizum is the company Payment Processing Company, owned by 29 banking entities. Thanks to this model, any user with an account with Spanish IBAN At a participating bank, you can send and receive money almost instantly, even if the sender and receiver have different banks.
To use it, you just have to Link your phone number to a bank accountFrom then on, when you want to send money, you select the person from your contacts in your bank's app, enter the amount, and confirm the transaction. The recipient sees it in their account in a matter of seconds.
Regarding amounts, Bizum usually handles fairly clear limitsThe usual minimum is around €0,50, and the maximum per transaction ranges from €500 to €1.000, depending on the institution. There is also a maximum number of daily and monthly transactions, as well as a total monthly limit that is typically around €5.000.
A key aspect is that You can only have one phone number linked to a single Bizum account.You can change which account is associated from your bank's app, but you can't have the same mobile phone connected to several accounts from different entities to receive money, which makes the system simple but somewhat rigid.
What is PayPal and what makes it different from Bizum?
PayPal, for its part, is a online payment service with international reach which originated in the United States in the late 90s. Its initial goal was to serve as an intermediary between your card or bank account and online stores, so that You don't have to share your financial data with every website where you shop..
To use it you need to Create an account on the PayPal website or appProvide your email address and link one or more cards or bank accounts. Unlike Bizum, here you can manage multiple payment sources and choose which one you want to use each time.In addition, PayPal allows you to maintain a balance in its own virtual wallet, even if you haven't yet added a bank account.
In terms of usage, PayPal has become very popular because millions of online stores It is accepted worldwideIt has also gained traction in peer-to-peer payments, as you can Send money simply by knowing the recipient's email address or phone number., without needing to have your bank account.
Another big difference compared to Bizum is that PayPal works with many currenciesYou can pay in euros, dollars, and a wide range of international currencies, with automatic currency conversion. However, these transactions often involve fees or exchange rates that are less favorable than those offered by the interbank market.
One highly valued point is its Buyer ProtectionIf you pay for a product or service and have a problem (it doesn't arrive, it arrives damaged, or it's not what was promised), you can open a dispute and PayPal may refund your money if they believe you're right. This is especially useful for purchases on foreign or lesser-known websites.
Key differences between PayPal and Bizum when sending money to friends
When we talk about send money to friends or familyBoth Bizum and PayPal allow you to do it quickly, but their philosophies are different. Bizum is primarily designed for domestic, small and immediate payments between people who already know each other. PayPal, in addition to that, aims to online payments and international transfers.
The first big difference is the registration and activationWith PayPal, you need to create an account, verify your email, link a payment method, accept their terms and conditions, and in many cases, go through additional verifications. With Bizum, on the other hand, You simply activate the service from your bank's appwithout having to memorize new passwords or manage a separate platform.
They also change the information you need to know about the other personWith Bizum, all you need is their mobile number, which is usually already saved in your contacts. With PayPal, you can use their email address, phone number, or even personalized links like PayPal.Me or the newer ones. PayPal Linkswhich work as a unique link that you send via WhatsApp, email or social media to get paid.
In terms of speed, both systems allow instant payments between individualsIf you send money via Bizum, the recipient automatically sees it in their bank account. With PayPal, the money arrives in the recipient's PayPal balance in seconds, and they can then use it directly or transfer it to their bank (quick withdrawals may incur a fee in some countries).
One of Bizum's most obvious limitations is that It only works with Spanish bank accounts and in eurosYou can have a foreign phone number associated with it, but the IBAN must be Spanish. PayPal, on the other hand, It operates in more than 200 countries and multiple currencies.So if you have friends or family outside of Spain, it's usually the most convenient option for sending them money.
Bizum vs PayPal: technical operation and types of transactions
On a technical level, Bizum is a standard that is integrated within online bankingIt does not store its own balance: each transfer and each payment is debited or credited directly to the associated bank account. This makes its operation highly dependent on the security measures of each bank (electronic signature, SMS codes, biometrics, etc.).
PayPal works like an independent platform with its own infrastructureIt centralizes payments, manages internal balances, and only sends money to your bank or charges purchases to your card when you choose or when you've set up automatic withdrawals. This allows it to offer additional features such as Multi-currency accounts, mutual funds, or payment buttons integrated into websites.
Both services have made the leap to payment in shops; for businesses there are solutions of B2B payment managementBizum can now be used in thousands of Spanish online and physical stores; you simply enter your mobile number and authorize the purchase through your bank. PayPal has been around much longer and is one of the leading payment methods in international e-commerce, marketplaces, and subscription platforms.
In addition, Bizum has incorporated donations to NGOs and payments to public administrationssuch as filing income tax returns or collecting lottery winnings. PayPal, for its part, is very popular among freelancers, small businesses, and content creators for its tools to generate payment links, invoices, and embedded buttons.
Costs, fees and terms of use
One of the most common concerns is the cost of using each system. In the case of Bizum, Most banks do not charge fees for sending or receiving money Transfers between individuals or at participating businesses are not included. Fees, if any, depend entirely on the bank, but the service is usually free for the customer.
PayPal is a bit more complex. In general, money transfers between friends or family in the same currency And financed with PayPal balance or bank account, they are usually free in many countries. But when it comes to business payments, currency conversions, or instant card withdrawalsFees apply, which may be a percentage of the amount, a fixed fee, or both.
It is also worth remembering that PayPal penalizes inactivity on some accounts.If you keep your account inactive for a year, an annual fee (e.g., 12 euros) may apply for inactive accounts, depending on the conditions in force at any given time and country.
For sellers and freelancers, PayPal acts as payment gatewaySimilar to a virtual POS terminal, it charges fees for each payment received, something that doesn't happen with Bizum at most banks for peer-to-peer use, although some businesses also pay to offer Bizum as a payment method.
In short, from a commission perspective, Bizum is usually the cheapest option for sending money in Spain between acquaintances, while PayPal is more versatile in exchange for assuming certain costs in specific transactions.
Security, user protection and potential fraud
Both Bizum and PayPal are considered safe and regulated servicesBut the way they protect you is different. Bizum inherits your bank's security: use of passwords, biometrics (fingerprint, facial recognition), SMS codes or push notifications to authorize transactions, and encryption of all communications.
PayPal also uses advanced encryption, two-factor authentication, and automated fraud detection systemsBut its biggest advantage is the aforementioned Buyer Protection. If you buy something from an online store that accepts PayPal and a serious dispute arises, the platform can refund the money if it believes you were scammed or that the seller failed to deliver.
Yes, no system is immune to deceptionIn the case of Bizum, a scam has become popular in which the supposed buyer sends you a "request" for money instead of a payment, and if you're not careful, you might end up sending them the money yourself, believing you're accepting a payment. It's always advisable to check if the transaction clearly indicates "send" or "receive," and to know how detect phishing emails.
With PayPal, the most common problems arise when transactions are made Payments made as "between friends" to strangers to save on fees. Buyer Protection doesn't apply to these types of transactions, so if you're scammed, it's much harder to get your money back.
In both cases, it is essential to activate all the additional security measures that offer features such as instant movement notifications, two-step verification, and periodic review of authorized devices.
Shipping limits and geographic scope
Bizum imposes relatively tight limits Designed for everyday payments: accounts in Spain, transactions in euros, and moderate amounts. The minimum is usually €0,50, and the maximum is €500 or €1.000 per transaction, with daily and monthly limits to prevent its use for transferring large sums.
PayPal is considerably more flexible in this regard. Although it also has internal limits. the limit per transaction can reach several thousand euros (for example, 8.000 euros in verified accounts and in certain currencies), and its activity is not restricted to a single country or a specific currency.
If you need to send money to a friend who lives in another city within Spain, Bizum works perfectlyBut if the person is in another country or uses a different currency, you'll almost certainly have to use PayPal or alternatives like Revolut, which also makes it easier. international payments and multi-currency accounts with good exchange rates.
In summary, we could say that Bizum is the king of small national operationsPayPal, while it is more suitable for international contexts, purchases on foreign websites, or payments that exceed the usual limits of Bizum.
PayPal Links: PayPal's answer to the "Bizum model"
In recent times, PayPal has launched PayPal LinksThis system allows users to create a personalized link to request or receive money, and is designed to compete with solutions like Bizum and similar services. The user generates a link from the app, enters the amount they want to receive, and shares it via WhatsApp, email, SMS, or social media.
The person who receives the link only has to Open it, log in to PayPal, and complete the payment.The money arrives instantly in the sender's PayPal account, without both parties needing to exchange phone numbers or bank accounts, which adds an interesting layer of privacy.
These links have a 10-day expirationThis reduces the risk of them circulating indefinitely. Furthermore, the issuer can cancel, resend, or send reminders to those who haven't yet paid.
Compared to Bizum, PayPal Links offers the PayPal's international reach and the ability to operate without sharing sensitive personal dataHowever, it has the disadvantage that, for the moment, it is not as integrated with traditional banking nor does it have the level of mass use of Bizum in Spain.
As PayPal rolls out these links in more European countries, we're likely to see a more direct competition in the field of instant paymentswhich in the long run usually translates into better services and conditions for the end user.
Advantages and disadvantages of Bizum compared to PayPal
If we weigh everything up, Bizum stands out for being Extremely simple for the average Spanish userIt's in the app of your traditional bank, doesn't require additional registration, and allows you to send and receive money with your mobile phone almost instantly and without fees in most cases.
Its popularity is enormous: it boasts tens of millions of active users Bizum is widely used in Spain and is integrated into more than 25 banking institutions. It's increasingly used to pay for small purchases, split restaurant bills, buy tickets, or make donations, which has made the verb "to make a Bizum" completely commonplace.
But it also has its drawbacks. Among them, its limitation to Spanish territory and the euroThe fact that you can only have one IBAN associated with a phone number or the amount limits make it impractical for large or repeated high-value transactions.
PayPal, on the other hand, shines when we talk about international payments, online shopping and buyer protectionIts global reach, support for multiple currencies, and ability to function as a payment gateway for businesses make it a very complete tool.
The flip side is the commissions on certain transactionsThe need to manage a separate account and the fact that, for some users who just want something simple to pay friends in Spain, it is more cumbersome than Bizum.
Other payment systems that come into play
Although Bizum and PayPal are the best known, there are other players worth mentioning. One of the most powerful is Revolut, which offers multi-currency accounts, physical and virtual cards, currency exchange at very competitive rates and instant money transfers between platform users.
Revolut allows, for example, split a dinner bill and send payment requests to your friends so that each person can pay their share through the app. The downside is that everyone has to be a Revolut customer, which somewhat limits its use in circles where it's not yet widespread.
Other neobanks such as N26 or Bnext They also offer their own instant money transfer systems, very similar to Bizum, using the phone number in your contacts. Again, the condition is that both the sender and the receiver are clients of the same entity.
In the European context, solutions such as Werowhich aims to be a "European Bizum" by accepting payments between accounts in different countries within the SEPA area. It is still in its expansion phase, but it aims to address one of Bizum's major shortcomings: cross-border payments within the European Union.
There are also projects like Whistling MoneyThese are aimed at enabling payments through WhatsApp as a digital wallet, and are trials of integrated payments on platforms such as Google Wallet or WhatsApp Pay, which could significantly change the landscape in the coming years if they become established in Spain.
When to use Bizum and when to use PayPal in practice
On a practical level, if what you want is pay your share of a dinner party, repay a small loan to a friend, or share household expenses Within Spain, Bizum is usually the most convenient and fastest option. It has virtually no learning curve and almost everyone has it activated on their mobile phone.
If your friends or family live outside of Spain or in another currencyBizum no longer works for you, and that's where PayPal (or Revolut) comes in. You can send money to another country, and the platform will handle the currency conversion, although with the corresponding commission or adjusted exchange rate.
To buy onlineEspecially in foreign stores or on websites where you're not entirely comfortable entering your card details, PayPal is a highly recommended option. Not only for the convenience of paying with two clicks, but also for the coverage offered by its dispute and refund system.
In Spanish shops that already accept Bizum, it can be a good alternative if you prefer that the charge will go directly to your bank account And you don't want to manage intermediate balances. However, in case of a dispute, your protection will depend more on the bank's and merchant's policies than on a mediation service like PayPal.
If you are particularly concerned about privacy of your phone numberPayPal allows you to collect payments using only an email address or a payment link, avoiding having to share your mobile phone with people you don't trust.
Influencers, content creators, and payments via Bizum or PayPal
If you're an influencer, streamer, or content creator, the topic offers even more possibilities. You can get paid through platforms like Twitch, YouTube, TikTok, OnlyFans, or Patreonwho handle invoicing and VAT in many cases, in exchange for taking a significant commission on each transaction.
The other way is to offer it to your audience direct payments via PayPal, Bizum or other systemsThe advantage here is that the money arrives faster and with fewer intermediaries, and that, in principle, you receive an amount closer to the total your fan wanted to donate, especially if you use Bizum within Spain.
However, this has a fiscal side: in the For direct payments via Bizum or PayPal, you are responsible for managing the VAT and registering as self-employed. If those payments are not one-off, in many situations, if you cannot correctly identify who is paying you (for example, you don't have their complete information to issue an invoice), you will have to include 21% VAT in the amount received.
Furthermore, in terms of administrative managementIt's more laborious to manage dozens or hundreds of micropayments than a single grouped payment from a platform. Issuing ten invoices of €100 each takes much more work than a single invoice of €1.000, even if the total amount is the same.
That's why many creators opt for a mixed strategy: they use centralized platforms for your main revenue streams and they leave direct Bizum or PayPal for one-off contributions, specific promotions or extra support from their closest community.
The key to not going crazy with Bizum, PayPal, and the other alternatives is to be clear about what you need at any given time: if you're looking for Speed ​​and simplicity to get around among friends in SpainBizum is hard to beat; if the priority is Shop online with extra protection, collect payments from international customers, handle multiple currencies, or receive payments as a professional.PayPal (perhaps accompanied by Revolut or other fintech services) will give you much more flexibility, although you will have to live with some fees and a little more management.
