What Is PayPal Honey? The Extension, the Scam Allegations and the Lawsuit

Updated October 2026 with the latest on the lawsuit, Chrome’s policy change and Honey’s user numbers.

What is PayPal Honey? It is a free browser extension, owned by PayPal, that searches for coupon codes and applies them at checkout. Tens of millions of people installed it. In December 2024, a viral investigation showed the PayPal Honey extension was also taking affiliate commissions that should have gone to the creators who recommended the products, and could hide better coupons from shoppers. Honey has since lost millions of users, Google changed its Chrome rules, and a creators’ lawsuit against PayPal is moving forward.

In this blog, we’ll break down what’s happening, how these practices affect creators and shoppers, and what you can do to stay informed and protect yourself as a content creator. Need a reliable hosting provider that respects your business? We’ve got you covered.

What is PayPal Honey?

PayPal Honey is a free coupon and rewards browser extension owned by PayPal. It tests promo codes at checkout and earns money from affiliate commissions paid by merchants.

Honey was founded in 2012 by Ryan Hudson and George Ruan, and PayPal bought it in 2020 for about $4 billion, according to Wikipedia. Today it is listed in the Chrome Web Store as “PayPal Honey: Automated Coupons & Rewards,” offered by PayPal Inc. Its own site describes it as 100% free and includes a price tracker called Droplist.

Honey markets itself as a “smart shopping assistant,” designed to find and apply coupon codes automatically when you shop online. Its easy-to-use interface and compatibility with major e-commerce platforms helped it gain widespread popularity. Users were drawn to the idea of effortless savings, and influencers frequently promoted the tool, helping Honey grow into a massive brand that caught PayPal’s eye.

How does the PayPal Honey extension work?

When you reach a checkout page, Honey pops up, tries its saved coupon codes and applies the best one it finds. Merchants pay Honey a commission on the sale.

That commission is the whole business model. Honey’s Chrome Web Store listing now says it plainly: when you use PayPal Honey, merchants may pay it affiliate commissions, and it shares those commissions with users as rewards. The controversy is about when and how Honey claimed those commissions, and whose commissions it took.

How does Honey take commissions from content creators?

Affiliate marketing is a critical income stream for content creators. When creators recommend products, they often include affiliate links that track purchases, earning them a commission on each sale. This creates a win-win situation for brands, creators, and consumers.

However, Honey’s browser extension has been accused of replacing these affiliate links with its own during the checkout process. When this happens:

• Creators Lose Revenue: The commission that should go to creators is redirected to Honey/PayPal.

• False Performance Metrics: Content creators may appear to generate fewer sales, impacting their ability to secure future partnerships with brands.

This practice directly undercuts creators’ income and diminishes the trust between creators and their audience.

Does Honey hide better coupons from shoppers?

Honey’s value proposition is its ability to find the best discounts, but insiders allege that the extension allows merchants to pay for hiding certain coupon codes. This means users may not always get the “best deal” despite the tool’s marketing claims.

If true, this would mean that Honey not only fails to deliver on its core promise but actively misleads users in favor of profits.

What does this mean for shoppers?

For shoppers, Honey’s alleged practices could mean:

1. Missed Savings: Better coupons might be hidden because they don’t align with Honey’s partner agreements.

2. Misplaced Trust: Shoppers use the extension expecting transparency, not realizing they might not be getting the best deal.

How has PayPal responded?

PayPal has defended Honey’s practices, citing adherence to “last-click attribution,” an industry standard for affiliate tracking. However, critics argue that these standards are outdated and do not align with the expectations of transparency and fairness. Separately, if a PayPal invoice ever shows up for something you never bought, read our guide to the PayPal invoice scam before you call any number on it.

What happened after the Honey scandal?

Honey lost millions of Chrome users, Google banned the behavior in the Chrome Web Store, and a creators’ class action against PayPal is now in discovery.

Sources: Wikipedia’s PayPal Honey article for the user losses, the November 2025 dismissal and Rakuten; 9to5Google for the Chrome policy; PPC Land for the June 2026 ruling; and the Chrome Web Store listing for today’s user count. PPC Land also reports that Honey’s merchant partners fell from roughly 35,000 in December 2024 to just over 28,000.

Honey did change its behavior. In March 2025, 9to5Google found that a new version of the extension no longer applied Honey’s affiliate code when it had no coupon or cashback to offer. As of October 2026 there is no settlement and no claim form, so ignore any site asking you to “file a Honey claim.”

Is PayPal Honey safe to use?

Honey is not malware, and it is made by PayPal. Trusting it is a separate call, because it earns from merchants and has a history of taking creators’ commissions.

Installing Honey will not get your card stolen. What you are deciding is whether you want an extension that sits on every checkout page and gets paid by the stores you shop at. If you use it, the steps further down let you keep the savings without cutting out the creators you follow. If you would rather not, removing it takes a few seconds.

How do you remove the Honey extension?

In Chrome, right-click the Honey icon next to the address bar and choose Remove from Chrome, or remove it from the Manage extensions page.

Per Google’s Chrome help: right-click the extension’s icon and select Remove from Chrome. If the icon is hidden, open the three-dot menu, go to Extensions, then Manage extensions, select Remove on Honey and confirm. Other browsers work the same way through their extensions or add-ons page.

How to Protect Yourself: Consumers Looking for Coupons

1. Search for Coupons Manually: Instead of relying on extensions like Honey, visit trusted coupon websites or search directly for promo codes on Google. This ensures you’re seeing all available discounts, not just ones selected by the extension.

2. Be Wary of Hidden Deals: Understand that extensions may not always show you the best offers, so double-check other sources before completing a purchase.

3. Support Creators Directly: If a content creator provides an affiliate link or coupon code, use it to support them. Avoid using tools that might overwrite their tracking links.

4. Use Transparent Alternatives: Research and use extensions or tools that clearly prioritize user savings and don’t interfere with affiliate programs. Read reviews and privacy policies to ensure the tool is ethical.

5. Use honey in one browser session to find the best coupon, but then go back to the affiliate link, and click it, and use the coupon code. This makes sure the content creators we love can continue to create amazing content.

How to Protect Yourself: Store Owners Using Affiliates

1. Use Coupon Code Attribution: Instead of relying solely on affiliate links, provide sponsored content creators with unique coupon codes to include in their content. These codes are less likely to be overwritten by tools like Honey, allowing you to track the effectiveness of your campaigns more accurately.

2. Communicate Expectations Clearly: Let your sponsored creators know how the coupon codes will help track their performance. This builds trust and ensures you both have realistic expectations for sales results.

3. Audit Affiliate Performance Regularly: Review your affiliate program data to identify any discrepancies in tracking. If you notice irregularities (e.g., high sales but low affiliate commissions), tools like Honey may be interfering.

4. Educate Your Team: Train your marketing team about how browser extensions like Honey operate, so they can design campaigns that minimize their impact.

5. Incorporate Coupon Codes Strategically: Place codes in your sponsored content descriptions, emails, and social media posts. Since these won’t get updated to Honey immediately, you’ll have a more reliable attribution system in the short term.

By taking these steps, you can protect your revenue, ensure your affiliates are fairly compensated, and set realistic expectations for your marketing campaigns.

PayPal Honey FAQ

Conclusion

While Honey once seemed like a no-brainer for savvy shoppers, the allegations, the lost users and the ongoing lawsuit have cast doubt on its integrity. Both consumers and content creators are paying the price for practices that prioritize corporate profits over fairness and transparency.

If you’re a shopper, creator, or simply someone passionate about digital fairness, it’s time to scrutinize the tools you use and demand better from the platforms that dominate the online space.

A Heartfelt Thank You to MegaLag

We want to take a moment to thank MegaLag, who courageously brought this issue to light in December 2024. His video, ”The Truth About Honey,” is a deep dive into the questionable practices of the Honey browser extension and the impact it has on content creators, consumers, and online transparency.

MegaLag’s work has been instrumental in exposing how these practices not only hurt creators but also deceive the very users who trust Honey to save them money. By shedding light on this, MegaLag is giving creators and consumers the knowledge they need to make informed decisions and demand better from the tools they use.

If you’ve found this blog helpful, we strongly encourage you to watch MegaLag’s video and support his channel. By doing so, you’re helping amplify the voices of creators who are standing up for fairness and accountability in the digital space.

Thank you again, MegaLag, for your commitment to transparency and for helping everyone better understand this critical issue.

(Click here to watch the video: The Truth About Honey)