HOW DOES PAYPAL WORK?

[WilliamPitt]

I need a detailed explanation of the process. Thanks.

[shraby]

1. If you have an account and someone sends you

money, they charge you a percentage. I had one but stopped using it when I found that out.

[Calico Jack Rackham]

2. So true.

I only use it nowadays just to make payments and buy stuff off of ebay once in awhile.

[no_vote_no_count]

4. I don't think there is a charge for the free

accounts, is there?

The free accounts can only accept cash or payments from PayPal balance (not credit cards) and have a low transaction limit....but if that's ok for your needs, then you wouldn't have to be charged any transaction fees.

[crispini]

8. You are correct.

The only thing you are charged for is if you upgrade to a Premium account so you can accepting payments via credit cards. That charge is 5% of the payment, I think.

[Misunderestimator]

17. And if you don't do that, I believe that means that buyers are charged

a cash advance fee if they pay you from Paypal with a credit card. That happened to me at least...

[ohio_liberal]

35. 2.9 percent of the payment

for premier and business accounts. 2.2% for auctions sellers who only offer paypal as an online payment option. One can only accept $500 per month on the freebie accounts without having to upgrade to a business or premier account, then the limit is removed. Withdrawals are limited as well.

[catzies]

3. PayPal is an electronic intermediary -- think a digital "Western Union"

What PayPal does is provide the electronic pathway between you and a recipient.

It uses funds from a bank account or credit card you specify. It costs nothing to send. The recipient receives the net (your transmitted payment minus PayPal fees).

[Misunderestimator]

16. Actually... weirdly, it cost me $10 to send $20 a couple of weeks ago

to a private person... I had thought it would be like others I have paid through paypal, and there is no surcharge... in this case, the credit card I have linked to my Paypal account charged it as a cash advance. I was a little surprised by that, and will be more cautious in the future.

On the other hand, you can link a checking account to it, and not have that problem... I just prefer having as little of my account information online as possible, so I stick to one credit card for that type of stuff.

[McKenzie]

5. quick Google - hope it helps

http://www.paypaldev.org/default.asp

http://www.staffassoc.com/dpfonts/paypal.pdf

http://www.stylusinc.com/website/payment_systems/pay_pal.htm

[BlueEyedSon]

6. What do you want to know, please be more specific.

I was in the CC/electronic payments industry for 3 years.

[Don Claybrook]

27. I'm in that industry now

Who did you work for, if you don't mind my asking? I work for NPC, which has been bought recently by another, larger company.

[no_vote_no_count]

7. All PayPal info here.

This is from PayPal's own website, but this should answer most of your questions. It's sorted by topic such as how it works (basics), sending money, receiving money, withdrawing money, etc.

http://www.paypal.com/cgi-bin/webscr?cmd=_help-ext&eloc=0&loc=267&source_page=_home&flow=

[Eloriel]

9. No discussion of PayPal is complete without

a good look at some of this information:

PayPal Sucks
http://www.paypalsucks.com/

I refuse to use PayPal, period. The convenience is wonderful (and I was a user for a while, selling some stuff on ebay), but they've been guilty of shady and questionable and donwright unethical business practices from just about the get-go and once I got a good taste of that, I stopped using them. No way in hell I'll support unethical, rapacious business practices if I can avoid it -- and IMO PayPal is about the worst.

I don't feel much better about the company that bought them -- ebay. But at least there you're basically dealing with individuals if you're a buyer.

[Coastie for Truth]

19. NY AG Eliot Spitzer investigated PayPal

at the behest of his constituents, Citigroup (C2IT - a competing service to PayPal), Citi CEO Sandy Weill, and Citi Exec VP (and former Clinton Secretary of the Treasury) Bob Ruben. Spitzer closed his investigation without action (implying no criminality), and Citi closed their C2It business.

I have had serious "back office" problems with Citi - on my VISA card, my car leases, my checking accounts, and my savings accounts. If I didn't have so many Direct Deposits and OnLine Payment connections, I would pull out of Citi completely.

You may think PayPal is bad -- I think CITI is even worse.

I used PayPal extensively as a seller when I moved from a 3500 square foot house to a 1200 square foot condo, and when I switched from film photography to digital photography (I did not want to handle credit card information - no way). I was completely satisfied.

I prefer PayPal over giving my actual credit card number to an internet merchant. To much hacking into merchant sites.

[Eloriel]

23. Unethical does not necessarily equal criminal

(and more's the pity on that point). I stand by what I wrote.

And, yes, there are thousands and thousands of "satisfied" users out there -- along with far too many totally innocent people that PayPal ruined and/or just jerked around mercilessly and without recourse for weeks and months on end.

[Coastie for Truth]

25. PayPal and eBay

get so hung up in "security" that they trip over their own feet. I think the complaints come from their attempts to prevent hackers.

Frequently what looks like being difficult is just guarding against what their paranoid minds tell them might be a hack or scam.

I'm out here in Si Valley - and eBay/PayPal's security is very highly regarded by the IT community.

[Fridays Child]

33. I had a problem registering my card with PayPal. It wasn't their fault...

...but it wasn't mine either. The wrong three-digit code on the back was registered with some giant credit card clearinghouse service.

My gripe with PayPal was that, after I tried to register the card three times (I didn't yet know what the problem was, so I kept trying, per THEIR instructions), they blacklisted it as a possible stolen account number. I even had some little bastard customer service dude as much as tell me that I had stolen a card!

Anyway, my bank issued me a new card to get around the problem, and my experience with PayPal has been fine, ever since. I use the account for, among other things, making my quarterly contributions to DU.

[Coastie for Truth]

34. You got caught in the eBay-PayPal-IBM Anti-Fraud, Anti-Hack Routine

which is probably more "sensitive" then most anti-fraud, anti-hacking.

I had problems with them on this very issue about 5 years ago.

[yorkiemommie1]

21. we're done w/ them

they suspend accounts w/ a nebulous " read the rules " email. if you call them to plead your case all you get is a stony 'read the rules' response and they will NOT reactivate your account, or listen to your side of the story. my friend has had terrible problems w/ them.

if i buy any more on ebay ( and there is quite a thread on ebay's community section dealing w/ paypal issues ) i will pay by other means than paypal.

[earth mom]

10. I sell a little bit on ebay and that's how I got my account.

I've had it several years and use a debit credit card they sent me to get my cash out or to make purchases with. I don't see how people feel they are unethical. I've had only one chargeback which was a couple of years ago. I highly recommend paypal, however, I only fund my account with money from ebay sales, not my own checking account.

[enough]

31. I also have used Paypal with no problem for several years

as an eBay buyer of very small and sometimes very large-ticket (for me) items, and as an occasional eBay seller. I have no problem with their charging me as a seller for the service they provide (allowing me to receive immediate payment from people I don't know).

I also use it to donate to DU, Buzzflash, and a few others of the the folks who keep me sane.

[MelissaB]

11. Maybe this will help..

Personal paypal accounts are free

https://www.paypal.com/cgi-bin/webscr?cmd=p/ema/index-outside
Send Money


--------------------------------------------------------------------------------

Send Money allows you to pay anyone with an email address in 45 countries that accept PayPal.

Just enter the recipient's email address and the amount you wish to send. You can pay with a bank card.

Common uses for Send Money:

Pay for eBay items

___________________________________________________________

Also,

PayPal charges Premier and Business accounts to receive payments. Personal accounts are free, but may not receive credit card payments.


Personal Account Premier/Business Account
Open an Account Free Free
Send Money Free Free
Withdraw Funds Free for bank accounts in the US
Fees for other banks Free for bank accounts in the US
Fees for other banks
Add Funds Free Free
Receive Funds Free 1.9% + $0.30 USD to 2.9% + $0.30 USD
Multiple Currency Transactions Exchange rate includes a 2.5% fee* Exchange rate includes a 2.5% fee*

http://www.paypal.com/cgi-bin/webscr?cmd=_display-fees-outside
Split a restaurant bill or rent
Send money to your family or friends
Pay for online purchases
Use PayPal to send payments in any of these currencies:

Canadian Dollar
Euro
Pound Sterling
U.S. Dollar
Yen
Australian Dollar

[Misunderestimator]

18. That is so misleading.... How is it then that I was charged a $10 cash...

advance fee when making a payment through paypal with my credit card? That had never happened before, so I would have agreed with this info a couple of weeks ago, but beware.... not so free after all.

[MelissaB]

28. I mainly use paypal

for ebay purchases and have never been charged an extra fee.

[Misunderestimator]

29. It happened once to me, just recently.. never before in at least 5 years

that I've been using paypal... maybe I should be calling my credit card company about this... it's very odd.

[InvisibleTouch]

12. I don't know how detailed I can get, but...

...here's an overall explanation:

PayPal is an online service that lets you send and receive money from anyone with a PayPal account. It's free to sign up with, but if you accept over a certain amount per month, you have to get one of their Business or Premiere accounts, and they take a small percentage out of each transaction.

In my experience it's indispensible if you do any regular buying, selling, or accepting funds on the net, because it lets people pay you by credit card without your having to have an expensive credit card account from one of the other companies. You can either store your money in the PayPal account itself (and you can set it to earn a bit of interest), or you can download it to your bank account. You can also upload money from your bank account, if you need to pay someone over the net, or can use your credit card through PayPal as well. They accept all 4 of the major ones. You can add a PayPal link to any web page, so people can pay you directly through your own site.

They'll require either a credit card or a linked bank account (perhaps both - it's been a few years for me) to start up your account, but seriously, you can't beat it. I know people who are paranoid about using it, worried that someone could hack into their personal info that way - and, I'll be honest, I've heard that this has happened, rarely, in the past - but I've personally never had a problem, and have known only one person who had a problem, and she got it taken care of.

PayPal is owned by Ebay, as of a couple of years back, and I think this has greatly improved their customer service and reliability. Ebay doesn't want a black mark on its record.

So, I think you can feel pretty confident about using it.....

[BuyingThyme]

13. If you're looking to set up a PayPal account for receiving payments,

it's straight forward.

In effect, it's the easiest way to set us a credit card merchant account.

[Awsi Dooger]

14. I only know the basics, via eBay transactions

Where most buyers seem to insist on PayPal availability, due to convenience.

There are several different types of accounts, personal and business.  Basically, you can send and receive payments through email via the internet, to/from anyone with an email address using money from your PayPal balance or another option like a credit card, debit card or your bank account. Once someone makes a transaction, you are notified via email that they have received a payment from you. Usually it's a direct transfer that is immediately available, other times it's an eCheck that takes about four business days to clear. You login to PayPal to make your payment or transfer funds, very standard with a password and balance, etc.

When you pay by PayPal, it's the exact amount coming out of your account. But when you receive money you lose a percentage. For example, I think I sold something via eBay for $160 recently and lost about $6. That's why I prefer to accept money orders, but too many buyers don't want that type of snail-mail delay.

[Junkdrawer]

15. Assuming you want to send Andy money,....Two steps...

Signup here:
https://www.paypal.com/us/cgi-bin/webscr?cmd=_registration-run

Then send money to an email account here:
https://www.paypal.com/us/cgi-bin/webscr?cmd=_transaction-run

[idiosyncratic]

20. I've had a PayPal account for five years

It works very well and now you can even use a PayPal balance to pay credit card and other bills.

PayPal is very convenient and to send money, all you need is the other person's email address.

The only thing to watch out for is how you "fund" your payments. If you want to charge the payment, you have to click on a link that is barely visible in 4 pt. type.

The "default" setting for payments is out of your bank account. I DON'T want my payments to come out of that account if a merchant will accept a credit card payment.

[Coastie for Truth]

24. I have a linked debit card from my "Hobby and Fun" Account

which I use ONLY for eBay, amateur radio (HRO) and camera stuff -- period. If it gets too close to the minimum balance (in the credit union account) I exercise discipline until I get more money.

[msmcghee]

22. I've had a business account for a couple of years . . .

. . and a personal account for a couple of years before that. I accept credit card and PayPal payments for my products that I sell through my websites.

I've never had a problem with any aspect of their service.

I let my receipts accumulate in my PayPal Money Market account that pays a full percent above my bank.

They have very good online support that makes it easy to integrate my website sales with their system.

I haven't had to call for telephone support very often but they answer quickly and take care of my problems when I do.

Hope that helps.

[troubleinwinter]

26. "detailed explanation of the process", can't give ya that

but as a seller of art/design products, I can say that hundreds of transactions, including the link to UPS shipping and deposits to my bank acct have gone off without a hitch. Convenient for all, and pretty cheap.

[SheepBootHero]

30. Paypal takes some of the money you would normally get

It's the capitalistic method often disguised as a bargain.

What are you trying to sell?

[WillyT]

32. Hey Will... ala 'Penny Lane'...

Make sure you have a... 'clean machine'

Them bugs can be ruthless.

:scared: