Getting a PayPal Account

First, if you don't have a PayPal account, you might want to seriously consider getting one. Clicking on the PayPal logo on this site will get you started. As a buyer, PayPal is widely recognized and preferred by most eBay sellers. Some sellers will only accept PayPal. As a seller, PayPal is a must. PayPal allows you to sell on eBay to people who want to pay by credit card or use their own PayPal account. in you have a web site and are selling over the Internet, you can use PayPal to send invoices to customers via e-mail as well. I have used PayPal since 2002, and it has worked well for me on eBay, and for my small computer support and web hosting business. Plus, they pay 4% interest on balances you leave in your PayPal account.

PayPal makes money by charging transaction fees, similar to the fees you would pay to have a traditional merchant account with a credit card transaction company.

PayPal Fee Table:

For receiving transfers under $3000 USD: the fee is 2.9% + $0.30 USD.
For receiving transfers $3000.01 to $10,000: the fee is 2.5% + $0.30 USD.
For receiving transfers $10,000.01 to $100,000: the fee is 2.2% + $0.30 USD.
Receiving transfers over $100,000: PayPal charges 1.9% + $0.30 USD.

Once you sign up with PayPal, you will go through a verification process that can take up to a week. Plan ahead, and get your account established right away, so it is ready when you begin your eBay experience.

PayPal Requirements

You need no special technology nor a business license to send/receive money through PayPal. The only requirements are:

PayPal Account Types

This is the basic PayPal account that lets you pay for your eBay purchases with ease. You can use it to send and receive money. You can send funds to anyone with an email address in 55 countries and regions. Personal account will even let you accept payments should you sell something via eBay. The catch: you can only accept payments from other PayPal accounts, and you cannot accept credit or debit card payments.

There is no fee for either the Personal account or the transactions you make through it. There is, however, a limit on how much can you receive per month. If you plan to sell a a high volume of product, the Personal account might be too restrictive.

This type of a PayPal account has all the functionality of the Personal account, plus you can accept credit and debit cards, and bank account payments. Premier account also offers such features as “shopping cart” and payment reporting tools. This account type is good for a serious amateur seller who wants to move items online on a regular basis.

There is a fee to have a Premier account; please check PayPal website for details. The setup process of a Premier account is similar to that of a Personal account. If you currently use a Personal account, you can always upgrade to Premier.

This is the business class of a PayPal account, best suited to individuals running a large scale online business or online store. Business account allows you to operate under your business name, and use Reporting and eBay Tools with no restrictions on transaction size. It is the best choice if you expect complex Accounts Payable. There is broad functionality for the business owners that helps them to manage very large amounts of sales with ease.

Like Premier, there is a fee to have this type of account; please check PayPal website for details. The setup process of a Business account is similar to that of a Premier account. If you currently use either Personal or Premier account, you can upgrade to Business. (eBay 101)

Sending and Collecting Money with PayPal

PayPal Fee Table:

PayPal Requirements

PayPal Account Types