With this diverse generation where everything has become digital, for some years now even online banks have overtaken several physical brick and mortar buildings we call banks. And many people have decided to store their cash in their virtual bank accounts.
With the numerous number of virtual banks that are now outside like Cash App, Paypal, Venmo, Zelle, and many others, many people have seen it necessary to take their transactions online to these platforms also known to be one of the bests amongst the numerous ones that exist.
But same as they have decided that, online bandits also called scammers have also found a means to make some cash by getting into these platforms and misleading the owners into giving them cash unknowingly. But they have also found ways to bypass these bandits and keep their users safe and that is one of the reasons they are considered amongst the best.
That being said, we will be focalizing today on one of the above online banks which is the all known Paypal.
Paypal is an amazing platform for sending and receiving money and many platforms and many great people have recommended Paypal for some of their amazing features. Well, you surely came here to know these features and much more about Paypal to help you make a better choice in online banking. Well, keep reading the article to know more about Paypal, how it works, how to setup a Paypal account, and some other important questions you are looking for an answer to.
Table of Contents
What is Paypal?
Paypal is an online money transfer app with a website at Paypal, and also have an application for both Android and iPhone on Play Store and App store respectively; And this platform makes sending and receiving money very much easier and convenient for all.
How Does it Work?
Paypal as we said above is a platform that makes sending and receiving money easy and for you to use this platform, you need to first of all create an account and then link your account to a bank account, or a debit card, or even both for your account to function at it's best.
After linking your Paypal account to a bank account, your paypal will serve as a middleman for your online transactions where paypal will send or receive money. You can also be eligible to get the Paypal Credit: Which is like a Virtual credit card where you can pay for goods or services online on sites that accept Paypal.
But you need to make sure you know who you are sending money to. There are a lot of scammers that have these online platforms as their target. And they always go for the best platforms where they will have a lot of opportunity in catching people.
Is Paypal Safe?
This should surely be one of your questions. But Yes! Paypal is a safe platform for sending and receiving money but that will hold better if you know who you are sending money to, or who you are receiving money from.
Also, having a very strong pin or password is good and also activating a to-way authentication is amazing to keep your profile safe. Well, Paypal now holds more than 400million accounts and is available in more than 200 countries.
That's a whole lot of people to scam, but with a strong password and two-way authentication, your account is encrypted and safe from them.
It is also safer to know some common scam on Paypal and how to avoid them so as to keep yourself safe. With a feature like the refunding feature of paypal, if you send someone money mistakenly, you can request for a refund and you'll get your money back(though not in all cases).
You should also know that Paypal transactions are kept safe and only you and then receiver will see it. And your account informations are hidden so as to avoid future hacking of account. With all these, you will see that there are a whole lot of reasons not to fear using Paypal.
Why use Paypal?
There are a lot of reasons to use Paypal. They are;
1. Secured Transactions
There are several platforms where after a transaction, you will see some of your informations been exposed, but on Paypal, it's another story.
Paypal ensures data encryption and after a transaction, no sensitive information will be shown to your receiver or sender. Only informations like your name and email will be seen by your receiver.
2. Free Account
To create a Paypal account, all you need is to be in a country that accepts paypal, have an internet connection, and a browsing device to create your account. You won't have to spend any penny for account creations
3. Easy management
Paypal right now is the fifth most accepted platform for online transactions after Visa, Mastercard, American Express, and Discover. If you are having a paypal account with cash in it, you will never be blocked on any site because of a payment issue. Also, you can easily send and receive money on Paypal with some very easy steps.
Paypal is a platform that gains most of it's money from transaction fees. Purchasing things online is free except if you have to convert a currency. And when converting, you'll pay a fee of up to 3-4 percent.
Also, you could send money to someone in your country or state and at the moment, you won't be charged any fee for that. But when the transaction becomes an international transaction, then you'll be charged about 5% fee(0.99 to 4.99 dollars).
This is when you are sending the cash via your Paypal balance; But if it's using your debit card, then it becomes a 2.9% fee instead of 5%.
It is quite true that sending money locally you won't encounter any fees, but that applies for normal transfers where you will have to wait for about 2-3 days before the cash reaches it's destination.
But for an instant transfer, you'll pay a 1% fee and you will get the cash in about 5minutes maximum for local transfers but up to a day for international transactions.
How to Create or Setup a Paypal Account
To create or setup a paypal account, you'll have to decide whether you want a personal account or a business account.
A. Personal Account
The top users of this type of account are those who send money to pals and shop online. Compared to a business one, it is more accessible and simpler to use.
How to create a PayPal account is as follows:
- Visit PayPal's website and click the Sign-Up link in the top right corner of the page.
- You will then be prompted to select the kind of account you want to open.
- Choose Personal Account, then select Next.
- Your phone number must be entered and verified.
- Add your name, email address, and password after that.
- To complete the account creation process, click Continue.
- To finish the setup procedure:
- The blue "Get Started" button should be clicked.
- Describe your bank and credit card.
- Your email address will receive a link from PayPal asking for verification.
- Click the link, then adhere to the directions.
B. Business Account
Having a PayPal business account makes it easier for vendors to get paid for their goods and services. It enables companies to take direct payments from a customer's account as well as debit and credit card payments. Online checks are also accepted for payments.
Create online payment buttons for your website using a PayPal business account. Your customers can pay in this manner with a single click. The money can also be sent to a personal or company's bank account.
To open a business PayPal account:
- Click the sign-up button on the PayPal website and select Business account.
- Enter the details as requested. This includes the name of the company owner, their email address, physical address, and phone numbers for customer support.
- PayPal will send you a verification email when you've completed and submitted the sign-up form. Click the linked link.
- Then, sign in to PayPal once more and follow the instructions to enter the information for your company's bank account. You can also use the details of your own bank account.
- Following that, PayPal will ask your bank for verification. Normally, three to five days are needed to finish this.
- Keep an eye out for two tiny deposits from PayPal in the transaction history of your bank account. Once you've seen it, finish creating your business account by following the directions on the verification page.
Sending Money on Paypal
Once this creation of the account is done and you have a fully functional paypal account with your bank account linked, sending money will just be a matter of seconds.
All what you have to do is go to your account, browse for Sending and Requests at the bottom of the page and then click on it.
Then choose which type of transfer you are sending and then send after putting the receiver's informations.
In the congested market of online and offline payment apps, PayPal is a major player.
Basic functions like money transfers and using your bank account to make purchases are free for users. Other services, such as PayPal credit and debit cards and transactions involving currency conversion, have a fee attached. The costs are typical for the sector.
PayPal charges transaction fees to businesses that use the service. Additionally, they have access to a number of complementary small company services provided by PayPal.
Some Frequently Asked Questions on Paypal
These are some things you should know about Paypal too;
1. Who invented PayPal?
It was initially founded in December 1998 by Peter Thiel, Max Levchin, and Luke Nosek. It was then called Confinity and aimed to develop security software for mobile devices. It later switched to PayPal in 1999 when it became a digital wallet. It merged with x.com, which Elon Musk established that same year.
2. How can you view your PayPal balance?
You only need to log into your PayPal account to check your balance. You can do this using a computer browser or a mobile app. Your balance will appear on the left side of your screen if you log in using the website. It displays on the main account screen of the mobile app.
3. PayPal: Is It a Good Option for Small Businesses?
PayPal is just one of several rivals vying for customers from small businesses, but it's a significant one. Its benefits to merchants include outstanding usability and access to a variety of extra tools that might aid in managing a small business.
Comparatively high merchant fees, when compared to some credit card payment providers, are one of its drawbacks. (Remember that some essential services are provided free to users, therefore the cost falls on the merchants.)