How does the interest rate work for PayPal Smart Connect?

The interest rate for PayPal Smart Connect is variable and is determined based on the Prime Rate. This means that the interest rate can fluctuate over time as the Prime Rate changes. The Prime Rate is a benchmark interest rate that is set by banks and is generally used as a reference for setting interest rates on various loans and credit cards. PayPal Smart Connect's interest rate is calculated by adding a fixed percentage to the current Prime Rate. The specific percentage added may vary depending on factors such as creditworthiness. It's important to note that interest is only charged on balances that are not paid in full by the due date. To avoid interest charges, it is recommended to pay the balance in full each billing cycle.