AmEx Points Work With PayPal, but at a Low Value

The ability to redeem Membership Rewards in a certain way doesn't mean it's a good choice.
Robin Saks Frankel
By Robin Saks Frankel 
Edited by Paul Soucy
AmEx Points Work With PayPal, but at a Low Value

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American Express cardholders now have the option of using Membership Rewards points for payments through PayPal. If you use this option, though, you'll be surrendering significant value with every point redeemed.

As of October 2019, AmEx cardholders can use the Pay with Points feature at any online or in-app merchant that accepts PayPal as payment. When you use rewards this way, you get a value of 0.7 cents per point. In other words, if you have 10,000 Membership Rewards points, you can redeem them for $70 worth of PayPal payments.

That value is about equal to what you get when you use Pay with Points at Amazon or Walmart, but it's less than you can get with some other redemption options and well below the 1-cent-per-point threshold that generally divides the good options from the not-so-good.

Better than credit, but ...

When you're sitting on a pile of points and you aren't saving them up for anything in particular — like a big trip — redeeming them at a low value may seem better than just letting them collect virtual dust. And cashing them in for 0.7 cents apiece is better than the 0.6 cents apiece you get when you redeem Membership Rewards points for a statement credit.

But generally speaking, you should aim to get at least 1 cent per point. Travel redemptions will typically give you the most value for Membership Rewards points, whether it's booking through the American Express travel portal or transferring your points directly to one of the issuer's travel partners. See NerdWallet's guide to earning and redeeming American Express Membership Rewards for detailed information about redemption options and values.

Better options for PayPal

If you've got spare AmEx points to burn, the PayPal option is better than nothing. But if you're a heavy PayPal user looking for a credit card that will help you get the most out of the PayPal platform, skip the Membership Rewards cards. Here are a couple of better options:

PayPal Cashback Mastercard
NerdWallet rating 

If you're doing a lot of spending through PayPal, the $0-annual-fee PayPal Cashback Mastercard® is more lucrative. The card earns a pedestrian 1.5% cash back on purchases — but a rich 3% back on purchases via PayPal — and you can redeem those rewards in any amount, at any time, right into your PayPal account.

Citi® Double Cash Card
NerdWallet rating 

If your overall goal is to squeeze as much value out of your spending as you can, with the least amount of fuss, the Citi Double Cash® Card has a $0 annual fee and offers the most flexible rewards of all: cash. It earns 2% cash back on every purchase: 1% when you buy and another 1% when you pay your bill. Getting cold, hard cash back instead of a rewards currency means you'll likely never get stuck with an unused pile of earnings. Unless you're stuffing it into piggy banks (which we don't recommend).

Find the right credit card for you.

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