What is PayPal

PayPal provides an easy and quick way to send and request money online. You can transfer money (abroad) to family, friends, online shops, and auction sites like eBay.
PayPal allows its users to easily send money to friends, family, business associates and more. In order to start sending and transferring money via PayPal, you will first need to set up an account. Setting up an account with PayPal is free and only requires an email address and some basic information.

Once you have a PayPal account, you can both send and receive money from anyone else with a PayPal account. If you’re trying to send money to someone without a PayPal account and they ask you “What is PayPal?”, you can show them how to sign up for a free account. It is free to send money to family and friends. PayPal will charge a small processing fee if you use it to send money as part of a business transaction.

Payment methods supported by PayPal

You have several ways to fund the money you send to another party through PayPal:

Instant transfer:

Sending money this way means the money is immediately credited to the recipient’s account. That person can then immediately transfer the money to his or her personal bank account. If you want to send a transfer, you must have a credit or debit card registered with PayPal as a backup for your funds. It’s just like writing a secure check — without exposing any of your personal information.

eCheck:

Sending an eCheck isn’t as “instant” as an instant transfer. It’s just like writing a check from your checking account; it can take from three to five days for an eCheck to clear. You don’t need a backup source of funds when you use eCheck.

PayPal balance:

If someone sent you money through PayPal or you’ve sold something on eBay, you have a balance in your PayPal account. This balance is first applied to any purchases you’ve made. Then, when your account has no balance, you can choose to pay by credit card. It’s simplest to keep your books balanced if you withdraw any PayPal balance to your business account before making a purchase.

Credit card:

Charge it! Putting your PayPal purchases on a credit card is a good idea. Not only are you protected by PayPal, but your credit card company also backs you up in case of fraud.

You can register multiple credit cards on your PayPal account and select a different one for different types of purchases. That way, you can place personal purchases on one account and business purchases on another. It makes end-of-year bookkeeping a lot easier!