I don't see how his trust rating is a major roadblock here, if he fails to return the loan balance after the lending period then whoever gave him the loan can simply use paypal's charge back feature to get their money back.
Which wont always be successful and if he pays back in paypal he could do a chargeback as well meaning youre out of money.
Is that even possible? I don't feel like PayPal would even be a payment option if you could chargeback nearly as much as some people on this forum say, but I'm no expert. If it came down to proof, you could show PayPal that you had loaned him $20 and his payment to you was a repayment by him with, say, this thread and private messages. He'd have no proof to back his chargeback and PayPal would rule in favor of the loaner.
At least, that's how it plays out in my mind. I'm not entirely sure how PayPal works.
