What PayPal Users Should Know About Fees


Many people think of PayPal as a bank but it’s actually not. PayPal is a payment processing center, and thus the company charges various fees for the services that they provide to businesses and independent users. While it is true there is no fee for signing up for the services they provide, this does not mean that everything they offer is free. A quick call to PayPal customer service is all that is needed to request a copy of the complete fee structure.

Transferring Personal Funds

You will not encounter any fees if you choose to send money to friends and family within the United States who also have a PayPal account, provided that you use the funds that are already in your account or the funds come from a bank account that is linked to your account. However, if you want to use your debit or credit card you will be asked to pay nominal fees. The sender can pay the fee or choose to pass the fee along to the recipient. The recipient can choose not to pay the fee by not accepting the payment.

Receiving Money Transfers

There is no fee to receive money from friends and family within the United States so long as it is between PayPal accounts or bank accounts. The fees you might encounter stem from a person receiving a personal payment from a debit or credit card. You can pass on the fee to the sender who has the option to refuse to pay it (which cancels the transaction) or you can pay it yourself. PayPal contact is recommended for businesses that plan to accept lots of payments.

Fees for Goods and Services

You will not encounter any fees for using PayPal to purchase goods or services, but if you make any money from selling goods or services there will be a small fee. If making money from home or starting a small business is something that interests you, the fees you will encounter will include both a small flat rate fee and percentage fee that is calculated based upon the amount of money received. This can be for positions offered through independent contract work as well as selling goods through websites such as eBay.

International Payments

PayPal transactions are accepted for the use of transferring personal funds in most countries. If you wish to send a payment to someone who lives in another country there is a small fee for the service. The cost will be higher than sending in-country payments. However it should be noted that India currently does not participate with PayPal and it is not possible to perform this service. There are other country restrictions as well. Contact PayPal to ask for a list of countries that are not open for sending or receiving payments.

Withdrawing Money

If you ever need it, you can always take money out of your PayPal account at any time. It’s easy to transfer the funds you wish to withdraw from your PayPal account to your bank account free of charge. The process takes about 3-5 business days. You can also withdraw money after making a purchase at a local store as long as you have a PayPal debit card. You can make a request with PayPal customer service that a cheque be mailed to you, but there is a fee linked to using this method to withdraw your funds.