- 1PayPal originated roughly $600M in business and working capital loans in Q3.
- 2It has purchased $1.6B of receivables over the first nine months of 2025.
- 3Merchant receivables loss allowance rose to $163M from $113M at year-end 2024.
PayPal originated approximately $600 million in business loans and working capital loans in the third quarter of 2025. A financial institution makes the loans to PayPal's clients, and PayPal then purchases the receivables and services the portfolio. On that basis, the company has bought $1.6 billion of receivables over the first nine months of the year.
Credit loss allowance
The allowance for credit losses on PayPal's merchant receivable portfolio stood at $163 million at September 30, 2025, up from $113 million at December 31, 2024.
PayPal's earnings report ties the increase to a decline in credit quality among outstanding merchant loans, mainly from changes in acceptable risk parameters in 2024 that broadened eligibility. In the second quarter of 2025, the company also updated its expected credit loss model for all portfolios to use multiple economic scenarios instead of one. PayPal said those changes did not materially affect the allowance in the period.
Source reporting: deBanked.
