PayPal is an all-in-one electronic wallet and payment facility that enables users to send and receive funds online or in person. Its features include online invoicing, customized checkout, payment tracking, shipping labels, merchant lending, customer financing, and more. Fees per online transaction start at 2.9% + 30 cents, and it’s best for ecommerce-focused businesses that prefer PayPal as their primary payment gateway.
PayPal Pros and Cons
Not an ideal in-person payments solution
Widely known and commonly used
POS integrations need improvement
Pay by PayPal button
Having a checkout cart requires additional fees
Who PayPal Is Best For
- Businesses that primarily accept orders and payments online: Many online shoppers know what PayPal is and find its convenience to be a huge plus, so using it for your ecommerce store may increase conversion rates and improve your sales. Moreover, aside from PayPal Credit and Venmo, the platform also accepts American Express, Visa, Mastercard, and Discover.
PayPal’s fees start at 2.9% + 30 cents (for United States transactions). Total costs vary depending on what was used to accept the payment (mobile and in-store or online and invoicing), where the payment was made, and whether you are under PayPal Payments Standard or PayPal Payments Pro.
The main difference between Standard and Pro is the monthly subscription cost of $30 for the latter. Furthermore, only PayPal Payments Pro enables you to design and host your own checkout pages and accept credit card payments via phone, fax, and virtual terminal.
Payment Types (US)
Online or Invoiced Transaction
Discounted Rate for Eligible Charities
1% + a maximum fee of $10
$30 per month
3.1% + 30 cents per domestic transaction
+ 1.5% for cross-border transactions
$10 per month
Advanced Fraud Protection
+ 5 cents** per transaction
*There are no fees for standard next-day transfers to linked bank accounts.
**Does not apply to PayPal Checkout and Express Checkout.
Bank transfers are limited to $25,000 per transaction. Meanwhile, instant transfer withdrawal limits for debit cards are as follows:
- Up to $5,000 per transaction
- Up to $5,000 per day
- Up to $5,000 per week
- Up to $15,000 per month
Please note that all international transactions incur a 4.4% transaction fee plus a fixed fee based on what currency was received. If a sale requires a currency conversion, then there is also an additional 3% charge.
PayPal Alternatives 2020
It offers small to midsize business (SMB) owners with solutions for processing payments and managing their finances. Let’s take a look at some of PayPal’s features below.
PayPal Invoicing: You can create and send customized invoices with the invoice template generator. All payment information may also be tracked within the system.
PayPal Checkout: Enables your customers to pay with Smart Payment Buttons that present them with the most relevant payment method.
PayPal Payments Pro: You’re given the option to build an advanced checkout process that is specific to the look and feel of your business.
PayPal.Me: This is a personalized link that you can share to get paid from other PayPal accounts worldwide.
Special financing: This is available for purchases worth $99 and more.
Seller Protection: This feature helps you prevent any fraudulent charges.
Fund deposits: Money is credited to your bank account as soon as the next business day. You are given the option to get same-day or instant transfers to your bank account, for an extra fee.
Customer service: You may reach out to PayPal’s customer support team via phone from 5 a.m. to 8 p.m. Pacific time on weekdays and 6 a.m. to 6 p.m. Pacific time on weekends. It also offers email and live chat support and access to its Business Resource Center, community forum, and online resolutions center.
Data security: PayPal provides simplified payment card industry (PCI) compliance, monitors all transactions 24/7, and ensures online transactions are encrypted as bank details, and card numbers are never exposed. In the event of a dispute, your funds are held during the investigation and until the issue is resolved. Please note that protected transactions do not include digital items or services.
Most Helpful PayPal Reviews
Users who left positive PayPal reviews like how easy it is to set up an account and start accepting payments. Some also commended its knowledgeable customer support team. On the other hand, a few negative reviews mention issues with PayPal holding their funds without notice and difficulties with in-person transactions.
Helpful and responsive customer support
“The customer support is friendly, and you can notice the good preparation of its staff. Every time I had an inconvenience with my account, or I had to ask a very specific question, they came up with a better solution and accurate suggestions. The diversity of plans it offers is also very good, giving the user a series of options that adapt to their needs, as well as the business.”
Its security measures can sometimes be an inconvenience
“(Blocking and withholding your money without notice) is honestly the main issue I have had with PayPal as they do not offer an accurate response for why your account was blocked—only a default message that they observed suspicious activity. Another thing it does not do well is the cost of payments in foreign currency. If you make these transactions frequently, then it reflects fairly high fees in your account balance.”
PayPal Frequently Asked Questions (FAQs)
Which third-party applications does PayPal integrate with?
PayPal integrates with popular ecommerce applications, such as Shopify, Squarespace, BigCommerce, and WooCommerce.
What businesses can benefit most from using PayPal?
The software offers specific packages for nonprofits, educational institutions, political campaigns, government organizations, enterprises, and marketplaces.
Are there any other limitations to Seller Protection?
Yes, there are. Aside from digital products and services not being covered, Seller Protection does not cover issues due to the wrong item being delivered, locally picked up items, claims filed through eBay, international first-class mail, donations, mobile and virtual transactions, and prohibited items like drugs, ammunition, and counterfeit goods.
Our Top Payment Gateway Picks
If you aren’t sure if PayPal is right for you, then this article on the best payment gateways is a review of our top choices. Our team looked at a variety of solutions and narrowed our recommendations down based on the fees, security, ease of use and set up, sales channel served, and features, among others.