17 points every PayPal account holder should know.
If you have a PayPal account and find yourself struggling with their plans, fees, TOS, different account types etc then the following points are must read for you. Do check o ut the money saving tip in bold.
- There are three types of accounts in PayPal. Personal, Premier and Business. Personal vs Premier vs Business
- A single person can only have two accounts with PayPal. One Personal Account and other Premier or Business Account. Each account should have a unique email address, bank account and credit card associated with it.
- Opening a PayPal account and sending money from a PayPal account is completely free of charge for all three account types.
- Receiving funds from a PayPal account:
- To your personal PayPal account is free.
- To your premier/business PayPal account involves fees.
- You can also receive funds from from a credit/debit card.
- With personal accounts you can only accept five credit/debit cards payments while incase of premier/business accounts there is no such limit.
- Receiving funds from a credit/debit card to your personal PayPal account involves higher fee than premier/business account. Fee varies by country. Check out fee structure for US based PayPal account holders and fee structure for India based PayPal account holders.
- Premier/Business account holders can also accept payment through credit cards without asking the payee to register with PayPal.
- If you have a premier/business account, you cannot accept business funds to your personal accounts. It means you can’t ask your website visitors to put money in your personal account instead of premier/business account. However you can accept funds from your affiliate/advertising network in your personal accounts.
- Money Saving Tip: If you are a premier/business account holder and have a good standing with PayPal you can apply for merchant rates. Merchant rates attracts lower fee than normal premier/business accounts rates. To qualify for merchant rates you should have received more than $3,000.00 USD in PayPal payments in the previous calendar month.
- Premier/Business account holders have access to premium customer service. You have the facility to call them, send an email via the contact form or send a snail mail.
- Don’t let your money stagnate in PayPal account. Invest in PayPal Money market fund and see your money grow.
- Something for your protection. Never click a PayPal link in your email. There are lots of phishers around. It is always advisable to directly type-in the URL.
- While opening a PayPal account, use a Gmail address. Gmail has put in place some special authentication for PayPal wherein you will never find a PayPal phishing messages in your Gmail account.
- For simple needs, PayPal also provides a inventory management feature under merchant tools. Now no need to go for those big online shopping carts.
- If you are a merchant and want to find and test out how that PayPal button would behave in real time. Check out PayPal Sandbox
- If you are a PayPal account holder from outside US be prepared to shell out large sum of money as PayPal fee. Even while withdrawing money(in your currency) to your account, PayPal has its own exchange rate which is always lower than the current exchange rate. I wish PayPal could look into this uneven fee structure. For instance: If you are from India and assume you receive $100 in your account and current normal exchange rate is $1 = Rs50. The actual amount what you will get in your PayPal account would be $95.8 (3.9% of $100 + $0.3) and if you chose to withdraw to your bank account in India, the amount you will receive would be around Rs 4358 (PayPal exchange rate is Rs1.5 lower than normal exchange rate). All in all a loss of Rs 642 for an amount of $100!
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April 2nd, 2009
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Ankur Jain, founder of a web start-up, long-time blogger and proud owner of the "Learn" series of websites. 
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That’s a great piece of info mate…
Thanks
@Balaji: Glad you liked it
Yeah mate PayPal makes money mainly from us mate…
Hi
I like to open an account at PayPal. But since I do not have any credit card, I am not able to open an account in PayPal. So, there is any method to open an account in PayPal without the Credit Card? pls let me know
Thanking you
anup kumar
@Anup: You can open a PayPal account without a credit card.
Credit Card is only required when you want to become a ‘verified’ account holder.
Boss, How can I thank you ? I have just registered with paypal and just wanter to know more about and landed in your website. never seen such an info loaded web page in my life. Thanks allllott.
Janardhan: Thanks for your nice comment. It’s so morale boosting.
Really liked your post. You seems to know a lot about PayPal, Kindly help me.
I have heard PayPal demand lots of documents for Business Account. Could you tel me something about what documents they ask. I have a unregistered Individual Small Business in India which I operate from home. I do have Bank Account with Business Name, PAN Card on my name, Company Stamp, letterhead. What else to PayPal Demands.
Also I have read several places to open a premier account with Business Name eg If your Business name is Acme Solutions type Acme in First name and Solutions in Last name of Premier Signup. Article says this is trick for people with very small business. I would like to know Is it Legal to do that or PayPal is gonna freeze my account.
I tried contacting PayPal but their support really sucks.
Thanks.
@Mayank: Thanks for your kind words!
I do have Bank Account with Business Name, PAN Card on my name, Company Stamp, letterhead. What else to PayPal Demands.
I think that should be sufficient. You can check the PayPal help for the list of all required documents.
Article says this is trick for people with very small business.
I would suggest you not to take chances with PayPal. They are quick in limiting accounts and after that it’s a real long drawn process to deal with them. So better-safe-than-sorry.
All the best!
Gr8 Information Friend,
You have a good knowledge for Paypal Accounts.
Thanks
Paypal have destroyed my business before it got up and running, screwed my 2 ebay powerseller accounts up,our 1st holiday me my wife and 2 children were having in 3 years has been cancelled all because of the limitation rules and the fact they hold on to your money for 90 days always side with the buyer i could go on and on and on but to be honest i just wanted to warn any business going with paypal HAVE A BACK UP PLAN!!!!!!!!!!!!!!!!!!!
Hey Dude,
Awesome blog post.
In your 9th point,
“However you can accept funds from your affiliate/advertising network in your personal accounts.”
Are you sure of this?
I m going to start a closed network of advertising club, where in members get additional features if they pay.
Do I have to register under the Ministry of Corporate Affairs? I do have DIN.
Can I receive funds from members, into my personal account in paypal?
Or Shall I upgrade to premier ?
Do i have any problems from IT dept ?
[...] Off late we are seeing a growing interest in our products and services from people in India. Now PayPal has been very good with us till now. The issue with PayPal is that one can not accept payment from [...]
Great post friend,
Keep it up…