PayPal is very familiar American online payment system, which is big enough and which allows you to pay or get paid quickly and easily without sharing any of your financial information. PayPal was founded in 1998, USA, California.
You can use PayPal to pay for items on any of the thousands online retailers that accept PayPal. PayPal has very strict procedures to ensure complete e-commerce security, this protects both the merchant and the customer.
PayPal works in more than 190 countries but still has not yet provided their services to many countries that are known to have a high percentage of Internet users. Global network is working on increasing the list. Some of the users can send, receive and withdraw funds, but some of the users in those countries can just send or receive.
Once your account is set up, you just need to attach your bank account, credit or debit card to make online payments in a few easy clicks. Simply select the PayPal option in checkout. PayPal users make payments securely online using credit cards or bank transfers, as well as by maintaining funds in personal interest-bearing PayPal accounts.
A PayPal account can be funded with an electronic debit from a bank account or by a credit card.
Most often, people use this service to pay for items purchased on EBay which purchased PayPal in 2002, strongly encourages its users to complete most transactions via the PayPal website, and more and more commercial businesses are accepting payment via PayPal, including a variety of retail stores, airlines and hotels.
In June 2000, PayPal introduced a new type of account for businesses. PayPal business accounts were intended for high volume individual and commercial accounts. By the end of 2001, more than one-fifth of PayPal's 12.8 million accounts were business accounts. And PayPal has launched new student account.
4 account types:
Personal account.Personal account is the basic PayPal account that lets PayPal user pay for eBay purchases. Member can use it to send and receive money. PayPal member can send funds to anyone with an email address in allowed countries and regions. PayPal user with this type of account can accept payments from other PayPal accounts, and cannot accept credit or debit card payments. There is no fee for the Personal account or the transactions you make through it. There is, however, a limit on how much can user receive per month. If user plans to sell a high volume of product, this type of account is too restrictive. So for this option you'd better change it to Premier account. PayPal member may upgrade the account at any time and it doesn't cost anything.
Premier account.Premier accounts are for those members who have high transaction volume, need to accept credit card payments, or would like to access to PayPal special features, which are not offered with Personal accounts. Premier accounts include all the benefits of Personal accounts, as well as PayPal special features.
Business account.Business account allows member to operate under business name (a company or group name), accept all payment types for low fees and use Reporting and EBay Tools with no restrictions on transaction size. Also it allows PayPal member to accept payment from customers without PayPal accounts.
Student account.Student account was created for parents recently. It gives parents a way to easily fund an allowance for children 13 or over, and a way to quickly and easily send money to college students in the United States or internationally. The PayPal Student account provides the parent with tools for ultimate control of various permissions for the account, and provides the student with a debit card funded by the parents. PayPal restricts only a limit of 4 student accounts per parent account and restricts the right to deny or not credit any fraudulent activity that tries to take advantage of this opportunity. Student account does not linked to outside checking accounts. Instead, all transactions flow through the parent’s account.
In PayPal system member can send money before the account is verified. But unverified members have limits for their transactions. When a member opens PayPal account, he is usually asked only for the essential information so that the member can start using his account straight away. That's why all PayPal accounts are initially unverified and have limits on sending and withdrawing money. Usually when member's account is close to limit he will be informed by receiving notification. Customers who are verified will have completed some of these steps already. If all the requested verification steps are not completed within the given time, the customer will reach the annual receiving limit of allowed amount.
Options of the verified user
- Send and receive money as much and as often as possible.
- Boost credibility with buyers and sellers worldwide.
- Send payments instantly from your bank account.
- Take advantage of exclusive services such as PayPal Seller Protection.
Mass paymentMass payment allows anyone with a Premier or Business account to send multiple payments instantly - saving time, money and the hassle of having to individually send funds to every payment recipient. To send money, excluding mass payments, is free. Sending money through mass payments user of Premier or Business account pays fee 2% up to a maximum of $1.00 per recipient mass payment can be used for such things as:
- Affiliate commissions
- Customer rebates
- Pay-to-surf rewards
- Employee benefits
- Survey incentives
General description of feesPayPal fees apply only to completed transactions. PayPal does not charge setup, gateway, or monthly fees to maintain an.
To withdraw funds from PayPal account for physical check costs $1.50. Other withdrawal fee for Personal Account depends from country or region where PayPal user lives, also on method of withdrawing: Wire Transfer, electronic transfer or check withdrawal. That's why to check what applicable withdrawal fees you'll pay for transaction, member needs to select country or region where he currently is. For instance for Personal account in USA withdrawal fee is 0, and in Bulgaria - $2.50 USD. PayPal user can choose currency of money withdrawal (USD, EUR, CAD, HUF, etc.). PayPal system has also withdraw fee for returning funds, it calls Return Fee. If you would like to return your e-currency, it will be returned to you but return fee will be deducted.
PayPal fees are now the same for all accounts - Personal, Premier, and Business. Please note that the Purchase rate applies to all payments using Request Money.
Fees inside PayPal system also depend on country, fees of Personal transfers to friends and family in PayPal system are different. It is 0.5% to 2% - varies by recipient’s country (to receive and to send) when the money comes from PayPal balance or bank account. Sender decides who will pay the fee - sender or recipient.
For all accounts fee is 3.4% to 3.9% + $0.30 USD, it varies according to recipient’s country, when the money comes from a debit or credit card or PayPal Credit (fee is paid by the sender or recipient - decides the sender).
For purchasing goods, services, or EBay items, using any of payment methods listed above, fee is 2.9% - 3.9% + $0.30 USD.
On the "Send money” page in PayPal Personal Account one can find option “Purchase” and “Personal tabs”. The receiver of the Paypal money will incur fees if sender sent money and selected “Purchase”. However, if transactions are made under “Personal”, no fees will be charged. When user selects purpose of the payment, he can choose things like gift, living expense, payment owed, cash advance, or other. If PayPal user clicks to highlight the 'gift', it will be send as a gift payment. That means no fees will be charged.
Security tools.PayPal uses cutting-edge data encryption, fraud detection tools and all kinds of other advanced techniques to improve security. PayPal introduced an optional security key as an additional precaution against fraud.
User's account tied to a security key has modified login process: the account holder enters his/her login and password as usual, but then it is prompted to enter 6-digit security key, generated on the website.
This two-factor authentication is intended to prevent an account from being compromised by a malicious third party without access to the physical security key.