A PayPal guide to managing your money
PayPal, which also owns the popular payment app Venmo, is one of the oldest and most widely used. digital money transfer services. It acts as an intermediary between your source of funds and that of the recipient, such as a friend or a merchant. Last year, consumers in over 200 markets used 392 million PayPal accounts to buy goods and services or send money to friends and family around the world. About 34 million merchants have accepted payment through PayPal.
With PayPal, you can transfer money online without sharing bank or credit card information with the recipient. Basic personal service is free for most transactions. Founded in 1998, PayPal is not a bank. But it now provides many banking type services through partnerships with banks, such as credit and debit cards, bill payment and direct deposit. Other features include QR codes.
PayPal offers different types of credit, including a Buy Now, Pay Later service. PayPal also offers a cash-back credit card as well as a prepaid Mastercard and a debit card.
How does PayPal work?
PayPal acts as an intermediary between your money and a merchant. It securely connects to a bank account or credit card. You then use your PayPal account to make your purchases.
You don’t need a bank account or credit card to receive money in your PayPal account. But to send money to family and friends or withdraw funds, PayPal will require you to link a bank account.
What fees does PayPal charge for transactions?
Using a personal PayPal account is free in most cases if you want to send or receive money, donate, or pay for things through a PayPal account in the United States.
PayPal does charge exchange fees when you send money to friends and family outside the United States. There are also fees for other convenient personal transactions.
For example, PayPal charges 2.9% per transaction if you use funds from a credit card instead of a bank account. And there is 1.5% fee to transfer money into your account instantly instead of waiting a few days when PayPal sends it for free.
PayPal also charges fees for a variety of services beyond the basic free PayPal personal account. For example, there are fees for different types of credit. Be sure to check the terms and annual percentage rate, or interest charges for each credit service, which are handled by PayPal’s banking partners.
What is a PayPal Balance account?
A The account balance (previously called PayPal Cash or Cash Plus) allows you to store funds in your PayPal account that you can spend, send or save for future purchases. You can also access PayPal’s other offers, including credit cards, a debit card, and a prepaid card through the Balance account.
With the Libra account, you can use direct deposit, scan a check with the PayPal app, and use the PayPal Cash card to spend or withdraw from your PayPal balance.
Libra personal account does not pay interest and is not directly insured by the Federal Deposit Insurance Corporation (FDIC), although funds are indirectly covered if you have a PayPal payment card, enroll in direct deposit, or purchase cryptocurrency.
Who can I use PayPal with?
Several people and places accept PayPal as a method of payment, including:
- Merchants: If a merchant accepts PayPal payment, you can use it to pay for goods and services.
- Friends and family: You can send money to most friends and family who also have PayPal accounts with no transaction fees, unless you need to translate
- Employees or subcontractors: You can pay contractors or employees with a PayPal business account, which is different from a personal account. PayPal considers this to be a “commercial transaction” and comes with its own fees.
Can I be paid via PayPal?
Yes. You can set up direct deposit via PayPal The account balance. PayPal also offers a check cashing service through First Century Bank and Indigo money, subject to those banks’ terms and conditions.
Can I sell goods through PayPal?
If you are a business owner and want to accept PayPal, you need to create a PayPal account. business account.
While you can sell things through a personal account, a business account offers a wide variety of protections and services. This year, the Internal Revenue Service changed the reporting requirements for the sale of goods and services to $600 from $20,000 in 2021. This only applies to sales of goods and services. So check theirs or PayPal website with care.