PayPal offers interest-free deal

PAYPAL is offering free credit to thousands of customers in a push to take on High Street banks.

The electronics payment provider is tempting users with interest-free purchases to encourage greater take-up of its own services. Deals currently include 0 pc on goods purchased for four months.

This is a modest offer compared with mainstream deals. For example, the Post Office currently offers 27 months interest-free on spending. PayPal says it is more interested in generating greater take-up of its credit. It is better known as the payments service used by buyers and sellers on eBay.

Its lending arm, Paypal Credit, was launched only a year ago. It won’t divulge how many customers already use it. Its payment guarantee — covering customers when buying goods — continues to cause trouble for many users, with a high complaint rate.