The founder of the English Defence League said the online payments system told him he did not fit within its user guidelines.
He would never be able to use the platform again, the 35-year-old added.
PayPal said it does not comment on individual accounts, but said in a statement: “We do not allow PayPal services to be used to promote hate, violence, or other forms of intolerance that is discriminatory.
“We do not take decisions like these lightly, and we work hard to be rigorous and fair-minded when reviewing PayPal accounts.”
The ban follows online petitions demanding the firm stop processing payments for Mr Robinson gathered thousands of signatures.
But Mr Robinson, whose real name is Stephen Yaxley-Lennon, branded the ban as “fascism”.
“They just don’t like my opinion and want to silence me,” he said.
“The government and establishment can see I have public support, they can see I have the ability to fight back.”
Mr Robinson said PayPal has also frozen “a lot” of money that was in the account for 180 days.
PayPal said: “Striking the necessary balance between upholding free expression and open dialogue and protecting principles of tolerance, diversity and respect for all people is a challenge that many companies are grappling with today.
“We work hard to achieve the right balance and to ensure that our decisions are values-driven and not political.”
Mr Robinson was freed from prison in August after three leading judges quashed a contempt of court conviction.
On Monday, he was formally released from bail after his contempt of court case was referred to the attorney general.
The attorney general’s office has said all material was being looked at “afresh” before a decision was made on whether to refer Mr Robinson to the High Court for contempt.
It came after reports that Mr Robinson could make more than £1m during a potential trip to the US later this month, where he has been invited to speak at the US congress by a group of Republican politicians and is waiting waiting to see if US authorities will grant him a visa.