What is PayPal and how does it work?

PayPal is a payment service for faster, safer and easier checkout, allowing you to make payments, send money and receive payments without having to enter your financial details every time. 173 million people use PayPal to make purchases on millions of sites worldwide, in 202 countries and in 21 different currencies.

What is PayPal and how does it work?

What is PayPal and how does it work?

PayPal is an online payment system, it pays to buy things online and provides the facility to send and receive money safely and securely.

When you link your bank account, credit card, or debit card to your PayPal account, you can use PayPal to shop online with participating online stores.

PayPal acts as an intermediary between your bank and merchants and helps keep your payment information secure.

You can also use PayPal to securely send money to friends and family as well as receive money from people. This feature is useful for sharing rent with roommates, for example, or receiving money for your birthday.

What is PayPal Credit?

PayPal Credit is the line of credit program of the PayPal payment system. It is similar to a virtual credit card, but can only be used to make online payments on websites that accept PayPal. Just like traditional credit cards, PayPal Credit allows you to defer payments.

Why use PayPal?

Many people are interested in why to use PayPal. If you are interested in this matter, rest assured that using PayPal will give you the following benefits.

Secure transaction

When you pay to purchase things online using your debit or credit card, merchants can sometimes access your payment information. PayPal provides an extra layer of security by ensuring that merchants never see your sensitive data PayPal uses several features to keep accounts secure, including end-to-end data encryption, optional two-factor account login, and email confirmation for transactions.

Easy to use and convenient

PayPal is now the fifth most accepted payment option after Visa, MasterCard, American Express and Discover and is available in millions of stores online.

Have you ever failed to remember your credit card information while shopping online? You can use PayPal to pay with cards linked to your account without retyping your card numbers.

All you need to do to make purchases through PayPal is to remember or save your PayPal login information.

Is PayPal free to use?

Creating a PayPal account is free and online purchases and most personal transactions are also free. However, PayPal charges fees for certain types of transactions.

PayPal fees for purchases

There are no fees for shopping online with retailers that accept PayPal unless a currency conversion is involved. Online fee payment in the same currency is free. And foreign currency purchases require a 3 percent or 4 percent foreign transaction fee.

PayPal Fees for Personal Transactions

When you send or receive money from friends and family for personal reasons, and not for any commercial reason, PayPal treats it as a personal transaction. PayPal has a special "Friends and Family" tab that you can click on when making personal transactions Some of these transactions attract fees while others do not, mostly based on where you are collecting funds from and where you are sending them.

If you use your PayPal balance, bank account, or Amex Send™ account, there is no fee for a domestic personal transaction and a 5 percent fee (between $0.99 and $4.99 USD) for an international transaction. If you send money using a debit or credit card, you'll be charged 2.9 percent if it's domestic and 5 percent if it's international, plus a fixed fee that varies depending on your country ($0.30 USD for payments in the US). .

Are there any fees for receiving money through PayPal? Generally speaking, no there is no fee. Receiving money from a friend via PayPal is free, as long as no currency conversion is involved.

PayPal withdrawal fee

Along with some other fees you may encounter when using PayPal. There is no fee to transfer your PayPal account balance to a local account, but you will have to wait for the funds to go through. If you want instant access, you'll pay a 1 percent fee. Also, drawing a check from your PayPal account incurs a $1.50 fee per withdrawal.

How to make a PayPal account?

Before you open a PayPal account, you need to decide what type of account you want. PayPal offers two types of accounts, namely- Personal and Business.

What is Personal PayPal Account?

A personal PayPal account is the most common PayPal account for personal use. Used to allow you to send and receive money to make online purchases or use PayPal. This account will allow you to access your purchase history, link new bank accounts and add credit cards to your account.

What is a business PayPal account?

PayPal also offers accounts that make it easy for businesses to accept PayPal payments online as well as credit and debit cards online or in person, even if your customers don't have a PayPal account. Service-based businesses and professionals can also send invoices to clients and securely accept PayPal online payments.

Other's Online Payment Service

How to create a PayPal account for yourself?

You can create a PayPal account from your computer or mobile browser or directly by entering the PayPal website by clicking the site up button or you can open the account yourself by installing the PayPal app on your mobile. Here's what you need to follow:

  • Visit paypal.com or download the PayPal app from the App Store or Google Play.
  • Click on the blue "Sign Up" button.
  • Select "Personal Account".
  • Add your phone number and you'll receive a text with a security code to enter on the next screen.
  • Enter your legal first and last name, email address and a secure password.
  • Then, enter your mailing address and submit by ticking the Agree to PayPal Privacy Policy option. As a result your account will be created.
  • Finally, add a credit card, debit card or bank account to your PayPal account.

How to send money through PayPal?

There are several ways to send money through PayPal. The method you choose will depend on who you're sending money to, for what purpose, and what medium you want to use.

How to send money to friends and family using PayPal?

Whether you want to send money to a roommate for a share of the rent or give your niece cash for her birthday, follow the instructions below to pay friends and family through PayPal.

From the PayPal app or your online PayPal account, click the "Send" button.
Enter the name, email address or phone number of the person you want to send money to. You can scan your friend's PayPal QR code to get started quickly. If the person does not already have a PayPal account, they will be able to create a free account and claim the money.
Enter the amount you want to send. You have the option to add a message, which can be a useful reminder for you and the recipient to pay. For example, you can say "July Rent" or "Happy Birthday, Georgia!" can write
You'll be asked what your PayPal online payment is for: "Friends and Family" or "Products and Services." The latter will trigger a fee to be paid to the receiving account, so make sure you select the correct option to send money.

How to send money using PayPal for goods and services?

Let's say you hire a landscaper to mow your lawn and you use PayPal to pay the bill, or you ran out of cash at a flea market and want to buy something from a seller who accepts PayPal. So know how to send money for goods and services through PayPal?

If the seller has a QR code, tap the "Scan/Pay" option in the app to get started.
Otherwise, from the PayPal app or your online PayPal account, click the "Send" button. Then provide the name, email address or phone number of the person you want to send the money to.
Enter the amount you want to send. You can add a note (eg, "lawn mowed" or "antique dresser") to remind the merchant and yourself what the payment is.
PayPal will ask you if you are sending money to "friends and family" or "paying for goods and services".
You need to make sure which category you are sending money to.

How to pay through PayPal?

Whether you are wondering how to receive money from a friend on PayPal, how to receive PayPal money from customers or how to create an invoice on PayPal, paying with PayPal is easy. Note here that PayPal has various merchant fees associated with some payment options. So make sure you understand the best choice for your situation. That is, you use the one that is most convenient for you.

Accepting PayPal from someone

  • From the PayPal app or your online PayPal account, click the "Request" button.
  • From here you can choose from the following options:
  • Enter the email or mobile number of the person paying you
  • Create a PayPal.Me link to share
  • Share a bill
  • Create an invoice
  • Your friend can initiate a payment via PayPal to send you money by entering your email or mobile number.
  • When someone sends you money, you'll get a notification via email and/or the PayPal app. The money will be deposited into your PayPal account.
  • You can keep money in your PayPal account to apply it to future transactions or transfer it to your bank account.


PayPal is an e-commerce company that facilitates money transfers over the Internet. This method of online transfer is used as an alternative to traditional money transfer methods such as checks or money orders.

A bank account requires an electronic debit card or credit card to open a PayPal account. In the case of transactions through PayPal, the customer can apply for a check to the PayPal authority, or spend through his PayPal account or deposit into a bank account linked to his PayPal account.

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