PayPal Honey

Honey (now PayPal Honey) is a browser extension and platform owned by PayPal since its acquisition for $4 billion in 2020.^[1] The service, launched in 2012, is primarily known for its browser extension that automatically searches for and applies discount codes during online shopping checkout processes. The company is headquartered in Los Angeles, California.^[2]

• Collects extensive personal identifiers including name, email, IP address, and device IDs.^[3]
• Retains data for up to 10 years after account closure.^[3]
• Shares data with PayPal companies and merchant partners.^[3]
• Tracks detailed shopping behavior, including purchases, returns, and browsing patterns.^[3]
• Creates inference profiles based on shopping patterns and preferences.^[3]

• Consumer choice restricted by intentionally hidden discounts and deals.^[4][5]
• Mandatory acceptance of arbitration clause with class action waiver.^[6]
• No user control over partner-privileged discount system.^[4][5]
• Service can be terminated at PayPal's discretion without notice.^[6]
• Users forced to accept terms modifications without direct notification.^[6]

• Undisclosed manipulation of affiliate marketing links.^[4][5]
• Hidden redirect mechanisms affecting commissions.^[4][5]
• Selective display of coupon codes based on undisclosed partner agreements.^[4][5]
• Subject to multiple ongoing class-action lawsuits regarding alleged deceptive practices.^[7][8]

On 21 December 2024, the tech-related YouTube channel MegaLag posted a video titled "Exposing the Honey Influencer Scam," in which was alleged that Honey was engaging in systematic manipulation of affiliate marketing links through a process known as "cookie stuffing." Through this type of affiliate poaching, Honey was alleged to have removed the original content creator's affiliate cookie, which tracked that the content creator was responsible for the sale so they could receive a later commission, and instead injected Honey's own affiliate cookie without the user's knowledge. Through this process, Honey effectively claimed the commission for the sale that would have gone to the content creator who originally guided the user to the product. Honey did this even when it explicitly offered no discount or coupon codes to the purchaser.

In short, the investigation found that when users clicked on a content creator's affiliate link and subsequently activated Honey during checkout, Honey would:

• Delete the original affiliate's tracking cookie
• Replace it with Honey's own affiliate cookie via a hidden redirect tab that closed within a few seconds
• Claim the commission that was intended for the original content creator

The video presented several scenarios in which this affiliate poaching would occur, even when Honey offered no discounts or coupons to the user, namely:

• Upon the user clicking "Activate Rewards" when presented with a Honey pop-up indicating to do so.
• Upon the user clicking "Got It" to acknowledge and discard a Honey pop-up stating, "We searched for you but didn't find any deals."
• Upon clicking "PayPal" when presented with a Honey pop-up recommending the user check out via PayPal, which owns Honey, even when the option was already present on the native website and would have preserved the original content creator's affiliate cookie and commission if the user had done so through that website and not Honey's pop-up.

Part of the investigative piece included a section in which MegaLag tested what would happen to his own commission when purchasing a product with Honey and without Honey. He signed up for an affiliate program through a popular VPN provider and then made two distinct purchases. One purchase was made using the Honey browser extension, and the other without using the extension. He made each purchase using a VPN server in different countries (one in the U.S.A. and one in the Netherlands), and used "separate, new browser sessions with cookies cleared."^[4] He also signed up for Honey's rewards program to test how much of the commission would be shared with a consumer.

MegaLag found that when purchased without the use of Honey, he received a $36.50 commission for the sale as expected. However, when purchasing the product with the use of Honey, he received no commission and the commission was instead redirected to Honey. MegaLag also demonstrated that of the $35.60 commission poached by Honey, only $0.89 was shared with the purchaser via the rewards program.

Additionally, contrary to marketing claims about finding "the best deals," Honey was found to have agreements with partner stores allowing them to control which coupon codes appeared through the extension. This meant stores could hide better discounts while only showing Honey users lower-value coupons. The practice directly contradicted years of marketing claims that promised users they would "always get the best deal possible."^[4]

Simon Wijckmans, CEO of c/side, noted that "When users purchased via an affiliate link with Honey installed, commissions intended for creators were redirected to Honey. Additionally, Honey misrepresented deals as the best discounts while partnering with companies to hide better offers."^[5]

In December 2024, a class-action lawsuit was filed against PayPal by Wendover Productions, LLC alleging that Honey manipulated affiliate marketing links without proper disclosure or compensation. The suits claim Honey replaced legitimate affiliate links with their own, even when no coupons were found for users. This practice allegedly impacted both content creators and consumers who intended to support specific affiliates.^[7]

Gamers Nexus, LLC later filed a class-action lawsuit against PayPal in January 2025 citing the same grievances.^[8] They later announced in a video upload on 15 June 2025 that they were withdrawing, with prejudice, as a plaintiff.^[9]

Several parts of the Terms of service were updated and added, such as

• Change of the Governing Law from England and Wales to California in the United States
• Addition of an Arbitration.
• A number of small changes between the lines

Also noteworthy is that on 8 January 2025, older versions of the TOS were available on archive.org. However, as of 28 January 2025, the archive shows a "Failed to Fetch" error.^[10]

To prevent loss of those details:

• copy of Paypal Honey Terms of Services from December 2024
• copy of Paypal Honey Terms of Services from January 2025

on a more funny note, the current live version of the TOS^[6] (checked on 5 February 2025) shows "Last updated January 16, 2024"

Further investigations released by Megalag in December 2025 allege that Honey promotes discount codes for businesses that have not consented to partner with them, including scraping and publicizing discount codes meant for private employee use and not intended for public use. The promotion of these codes has been reported to have negatively affected the financial standing several smaller businesses.

When asked by such businesses to remove these private discount codes, Honey is alleged to have told those businesses that they are unable to remove the codes unless the business agrees to partner with them, essentially paying a fee to be protected from a service they do not want to partner with. Honey is also reported to have attempted to deceive such businesses about the company's capacity to remove such discount codes, with one agent claiming to one business that Honey was unable to remove a private employee coupon code from public distribution unless the business partnered with Honey, just one month after the same agent agreed to remove the private code of another business upon request. Honey eventually agreed to remove the code, however the business claims that the problem has occurred repeatedly.^[11]

In a separate video uploaded on 30 December 2025, MegaLag further alleged that Honey was violating affiliate network policies. An example he cited is where a typical contract clause may state "you are only allowed to use coupons or promotional codes that are provided exclusively through the affiliate program," but Honey would ignore the clause unless and until it was enforced. For instance, in the "Note Monetization" column for the application's data spreadsheet, an employee left a note stating that the Lindt chocolatier company had "non-affiliate clause, but don't have any codes from network so can't remove other coupon sources".^[12]

On 12 January 2026, MegaLag shared in a community post that an e-mail had been sent out to clients of Rakuten Advertising, a major affiliate marketing service provider. In the screenshot purportedly provided by a LinkedIn user, the company stated that "Honey has been terminated from the Rakuten Advertising network, therefore this publisher has been removed from your affiliate program, effective immediately" and that the removal "was not taken lightly." MegaLag also noted that Honey's Rakuten links were no longer active. No specific reason was given by Rakuten, however the timing of it came just barely two weeks after MegaLag brought to light allegations of Honey's willful policy violations.^[13]