How to Set Up PayPal Webhook Notifications with Webhookify

Published Feb 21 202610 min read
PayPal webhook setup with Webhookify

PayPal processes billions of dollars in payments every year, serving as a primary payment gateway for businesses of all sizes. Every time a customer completes a purchase, a subscription is created or canceled, a dispute is opened, or a payout is sent, PayPal fires a webhook event. Keeping track of these events is essential for maintaining healthy cash flow, resolving disputes promptly, and ensuring customer satisfaction. With Webhookify, you can receive instant, AI-summarized PayPal notifications on Telegram, Discord, Slack, Email, or your mobile device -- complete with a cash register sound for every successful payment.

This guide covers the complete process of setting up PayPal webhooks with Webhookify. The setup works with both PayPal's standard checkout and advanced integration APIs, and takes approximately 15 minutes from start to finish.

Why Monitor PayPal Webhooks with Webhookify?

  • Instant Payment Confirmation: The moment a customer pays through PayPal, you receive a notification with the amount, currency, payer email, and transaction details. This eliminates the need to constantly check the PayPal dashboard for new payments and ensures you can fulfill orders immediately.

  • Cash Sound for Every Sale: Webhookify's mobile app plays a satisfying cash register sound when a PayPal payment event arrives. For merchants and freelancers who receive PayPal payments regularly, this provides instant audible confirmation of incoming revenue.

  • Dispute and Chargeback Alerts: PayPal disputes have strict response deadlines. Webhookify delivers CUSTOMER.DISPUTE.CREATED alerts instantly, giving you maximum time to gather evidence and respond before the deadline passes. Missing a dispute deadline can mean automatic loss of funds.

  • Subscription Lifecycle Tracking: Monitor every stage of PayPal subscription billing -- from creation to renewal to cancellation. Know immediately when a subscriber churns or when a billing cycle fails, enabling proactive retention efforts.

  • Cross-Platform Payment Visibility: If you accept payments through both PayPal and other providers like Stripe, Webhookify consolidates all payment notifications in one place. See your complete revenue picture across all payment processors in a single Telegram group or Slack channel.

Prerequisites

  1. A PayPal Business account (personal accounts have limited webhook support)
  2. Access to the PayPal Developer Dashboard
  3. A Webhookify account (sign up free at webhookify.app)
  4. At least one notification channel configured in Webhookify (Telegram, Discord, Slack, Email, or mobile push)
  5. A PayPal REST API app (you can create one in the Developer Dashboard)

Step-by-Step Setup Guide

1

Create a Webhookify Endpoint

Log into your Webhookify dashboard at webhookify.app. Click "Create Endpoint" to generate a unique webhook URL:

https://hook.webhookify.app/wh/jkl012mno345

Copy this URL. Name the endpoint something descriptive like "PayPal Production" or "PayPal Sandbox" depending on which environment you are configuring. If you use both sandbox and live PayPal environments, create separate endpoints for each to avoid mixing test events with real payment data.

2

Configure Your Notification Channel

Navigate to the notification settings in your Webhookify dashboard and connect your preferred channels.

For Telegram: Connect the Webhookify bot to receive PayPal alerts in a private chat or team group. A dedicated "Payment Alerts" group works well for teams.

For Discord: Authorize the Webhookify bot in your server. Choose a channel like #paypal-payments or #revenue-alerts.

For Slack: Complete the OAuth authorization and select your channel. Many businesses use a #payments channel shared with their finance team.

For Email: Add email addresses for team members who need to track PayPal transactions. This is especially useful for accounting departments.

For Mobile Push: Install the Webhookify app and enable push notifications. Turn on the cash sound feature so you hear an alert every time a PayPal payment comes through.

3

Set Up Webhooks in PayPal Developer Dashboard

Go to the PayPal Developer Dashboard. Log in with your PayPal Business account credentials.

Navigate to Apps & Credentials. Select the REST API app you want to configure webhooks for (or create a new one if needed). Make sure you are working in the correct environment -- toggle between Sandbox and Live at the top of the page.

Scroll down to the Webhooks section and click "Add Webhook".

In the Webhook URL field, paste your Webhookify endpoint URL:

https://hook.webhookify.app/wh/jkl012mno345

Next, you will select the event types you want to monitor. PayPal organizes events by category. Click on each category to expand it and check the specific events.

For most businesses, the essential events are:

Payment Events:

  • PAYMENT.CAPTURE.COMPLETED -- Payment captured successfully
  • PAYMENT.CAPTURE.DENIED -- Payment capture denied
  • PAYMENT.CAPTURE.REFUNDED -- Payment was refunded
  • PAYMENT.SALE.COMPLETED -- Sale completed (older API)

Checkout Events:

  • CHECKOUT.ORDER.APPROVED -- Buyer approved the payment
  • CHECKOUT.ORDER.COMPLETED -- Checkout order completed

Billing/Subscription Events:

  • BILLING.SUBSCRIPTION.CREATED -- New subscription created
  • BILLING.SUBSCRIPTION.ACTIVATED -- Subscription activated
  • BILLING.SUBSCRIPTION.CANCELLED -- Subscription cancelled
  • BILLING.SUBSCRIPTION.PAYMENT.FAILED -- Subscription payment failed

Dispute Events:

  • CUSTOMER.DISPUTE.CREATED -- Dispute opened by buyer
  • CUSTOMER.DISPUTE.RESOLVED -- Dispute resolved

Click "Save" to create the webhook. PayPal will validate the URL and confirm the webhook is active.

4

Verify Webhook Registration

After saving, PayPal displays your webhook with a Webhook ID and the list of subscribed events. Verify that:

  1. The URL matches your Webhookify endpoint exactly
  2. All desired events are listed under the webhook
  3. The webhook status shows as active

You can view your webhook ID, which looks something like 8PT597108AL862346. Keep this ID handy in case you need to manage the webhook later through the PayPal API.

If you need to add more event types later, click on the webhook and select "Edit" to modify the event subscriptions.

5

Test Your PayPal Webhook

PayPal provides webhook simulation tools in the Developer Dashboard. Navigate to your webhook and look for the "Simulate Event" or use the Webhook Simulator.

Select an event type like PAYMENT.CAPTURE.COMPLETED and click "Send Test". This sends a simulated event to your Webhookify endpoint.

Check the following:

  1. Webhookify Dashboard: The test event should appear in your endpoint's event log with the full payload.
  2. Notification Channel: You should receive an AI-summarized notification on Telegram, Discord, Slack, or Email.
  3. Mobile App: If push notifications are enabled, you should receive a push alert (with the cash sound if this is a payment event).

For a more realistic test, use the PayPal Sandbox environment to make a test purchase. Create a sandbox buyer account and seller account in the Developer Dashboard, then simulate a complete checkout flow. This generates authentic webhook events with real-looking data.

PayPal Webhook Events You Can Monitor

| Category | Event | Description | |----------|-------|-------------| | Payments | PAYMENT.CAPTURE.COMPLETED | Payment successfully captured | | Payments | PAYMENT.CAPTURE.DENIED | Payment capture was denied | | Payments | PAYMENT.CAPTURE.PENDING | Payment capture is pending | | Payments | PAYMENT.CAPTURE.REFUNDED | Payment was refunded | | Payments | PAYMENT.SALE.COMPLETED | Sale completed (Classic API) | | Payments | PAYMENT.SALE.REFUNDED | Sale refunded (Classic API) | | Checkout | CHECKOUT.ORDER.APPROVED | Buyer approved the order | | Checkout | CHECKOUT.ORDER.COMPLETED | Checkout order finalized | | Checkout | CHECKOUT.ORDER.PROCESSED | Order processed | | Subscriptions | BILLING.SUBSCRIPTION.CREATED | New subscription created | | Subscriptions | BILLING.SUBSCRIPTION.ACTIVATED | Subscription became active | | Subscriptions | BILLING.SUBSCRIPTION.UPDATED | Subscription details changed | | Subscriptions | BILLING.SUBSCRIPTION.CANCELLED | Subscription cancelled | | Subscriptions | BILLING.SUBSCRIPTION.SUSPENDED | Subscription suspended | | Subscriptions | BILLING.SUBSCRIPTION.PAYMENT.FAILED | Subscription payment failed | | Billing Plans | BILLING.PLAN.CREATED | Billing plan created | | Billing Plans | BILLING.PLAN.UPDATED | Billing plan modified | | Disputes | CUSTOMER.DISPUTE.CREATED | Buyer opened a dispute | | Disputes | CUSTOMER.DISPUTE.RESOLVED | Dispute was resolved | | Disputes | CUSTOMER.DISPUTE.UPDATED | Dispute details updated | | Payouts | PAYMENT.PAYOUTSBATCH.SUCCESS | Batch payout completed | | Payouts | PAYMENT.PAYOUTSBATCH.DENIED | Batch payout denied | | Invoicing | INVOICING.INVOICE.PAID | Invoice was paid | | Invoicing | INVOICING.INVOICE.CANCELLED | Invoice was cancelled |

Real-World Use Cases

  • Freelancer Payment Tracking: A freelancer receives PAYMENT.CAPTURE.COMPLETED notifications on their phone with the cash sound enabled. Every time a client pays an invoice through PayPal, they hear the ka-ching and see a Telegram message with the client name, amount, and currency. This eliminates the need to check PayPal's app throughout the day.

  • Subscription SaaS Business: A SaaS company monitors BILLING.SUBSCRIPTION.CREATED and BILLING.SUBSCRIPTION.CANCELLED events on Slack. The team sees real-time subscription growth and churn metrics. When a BILLING.SUBSCRIPTION.PAYMENT.FAILED event fires, the customer success team is immediately alerted to reach out and help update payment information.

  • Dispute Response Automation: An e-commerce business routes CUSTOMER.DISPUTE.CREATED events to a high-priority Email and Telegram notification. Because PayPal disputes have strict response windows, the instant notification ensures the team begins gathering evidence immediately. They have never missed a dispute deadline since implementing Webhookify.

  • Multi-Currency Commerce: A business accepting payments in multiple currencies through PayPal routes all payment events to a centralized Discord channel. The AI summaries include the payment amount and currency, making it easy to track international revenue without logging into PayPal for each transaction.

Example Notification

Here is what a typical Webhookify notification looks like when a PayPal payment is captured:

New Webhook Event Received

Source: PayPal
Event: PAYMENT.CAPTURE.COMPLETED
Endpoint: PayPal Production

AI Summary:
Payment of $125.00 USD successfully captured from
buyer@example.com. Transaction ID: 5GH789012AB345678.
PayPal fee: $3.93. Net amount: $121.07.
Payment for Order #ORD-2026-1847.

Timestamp: 2026-02-21T09:23:15Z

View full payload in Webhookify Dashboard

Troubleshooting

  1. PayPal rejects the webhook URL: PayPal requires HTTPS URLs for webhook endpoints. Webhookify endpoints always use HTTPS, so if you get a URL validation error, check for typos in the URL. Also ensure the URL does not have trailing slashes or query parameters that PayPal might not accept.

  2. Webhook events not showing in Webhookify: Verify that your webhook is active in the PayPal Developer Dashboard. Check the webhook event log in PayPal to see if events are being sent. If PayPal shows successful deliveries but events do not appear in Webhookify, contact Webhookify support with the webhook ID and timestamps.

  3. Sandbox events work but live events do not: Make sure you created the webhook in the Live environment, not Sandbox. PayPal maintains completely separate webhook configurations for each environment. Toggle to "Live" in the Developer Dashboard and create a new webhook with your Webhookify URL.

  4. Missing event types: Not all PayPal API integrations support all event types. If you are using an older PayPal integration (like PayPal Standard buttons), some webhook events may not fire. Consider upgrading to PayPal's REST API or Checkout SDK for full webhook support.

  5. Delayed notifications: PayPal may delay webhook delivery during high-traffic periods or when retrying failed deliveries. If you notice consistent delays, check the PayPal status page for any ongoing issues. Webhookify processes incoming webhooks in under one second, so delays are typically on PayPal's side.

If you accept payments through both PayPal and Stripe, create separate Webhookify endpoints for each provider but route their notifications to the same Telegram group or Slack channel. This gives you a unified view of all incoming revenue regardless of the payment processor, and the AI summaries make it easy to distinguish between PayPal and Stripe transactions at a glance.

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How to Set Up PayPal Webhook Notifications with Webhookify - Webhookify | Webhookify