The "I'm not a charity" campaign, created by direct and digital agency Tullo Marshall Warren, lures potential customers to a microsite with online advertising placed on some key sites targeting a younger audience such as FHM, Nuts and Zoo.
At the microsite people can design their own charity appeal email, in order to bring humour to the potentially sensitive subject of asking friends to give back the money they owe.
Using a template of a poster pasted on torn up cardboard, people can insert their own photograph and copy, for example: "£10 means nothing to you, but it could mean the world to little John" (the customer's name).
They can then see what their ad looks like appearing on a mock poster, press ad, billboard and bus side ad before emailing it to their friend as a light-hearted way of reminding them to pay back the money owed. It also gives them the means to do so, through PayPal's person-to-person money transfer service.
Karen Maynard, senior account director at TMW, said: "To raise awareness of this service we wanted to devise an innovative and fun way that resonated with our audience's lifestyle.
"We know that the people who are more likely to use this service are young and sociable - owing friends small amounts of money for shared activities is very much part of their lifestyle."
Neil Harvey, consumer marketing manager at PayPal, said: "The creative idea developed by TMW is a unique approach for us that will allow us to reach the target audience in a more focused way.
"We are committed to getting the message across to our customers that the person-to-person money transfer service is very easy to use, offering a fast and secure way of repaying a debt to a friend."