PayPal is the largest payment platform that allows you to send and receive money without having to share your bank details. In fact, as of 2021, this e-commerce payment platform had 426 million users with a significant 87.5% of online buyers choosing this platform for at least one transaction.
It’s only obvious for online businesses to start using the platform to accept order payments.
But when you’re getting started, there’s always a confusion between the two types of PayPal accounts and which one you should be using.
Individuals are best suited to create personal PayPal accounts whereas e-commerce businesses and merchants should have business PayPal accounts in order to have access to enhanced features which are particularly suited to you.
Alternatively, if you were a small business earlier, a personal account would have worked just fine. But, as you grow, you may want to consider a business account to manage the payments better.
In this article, we want to help you understand the difference between a personal PayPal account and a business PayPal account and which account is more suited to your needs.
A PayPal personal account is one where the account holder primarily uses it for either online shopping or to send money to friends and family. However, a personal PayPal account can also be used by e-commerce business owners who sell their products online or businesses that provide their services to individuals.
For example, if you are an independent contractor looking to sell their services to clients like writing services or commissioning artworks, you can opt for a personal PayPal account. Additionally, if you are hoping to receive one-off payments, this type of account might be suitable for you.
To set up a PayPal personal account, here is what you need:
It is extremely simple to set up this account and can easily be done within minutes.
But when you use a personal PayPal account, the paying party can view all your personal details including your full name and address.
Furthermore, by owning a personal account, you will not have access to multiple forms of payment that business accounts enjoy.
If your business is just starting out, you may use this type of account initially. However, if you start getting payments more routinely, you might want to switch to a business account to leverage the additional features that come with it.
A PayPal business account is one that includes the features of a personal account coupled with additional features that can help businesses with an easy and affordable payment solution.
For example, this type of PayPal account allows users to not only send and receive invoices but also set up subscription services. This allows your customers to sign up for your product while setting up a recurring payment in a single transaction.
PayPal also makes it extremely easy for small to medium-sized businesses to create their invoices using the PayPal interface. This is especially helpful for businesses that are starting out since it reduces the burden of any additional work and also creates a painless payment process.
A PayPal business account is beneficial to slightly bigger companies too. This is because it allows logins for up to 200 people. Now, you can have dedicated teams that focus on shipping and fees, inventory management and even to track the profits.
Some of the additional services that business account holders can opt for are payment tracking, label printing and even live customer support to address customer queries in real-time.
Since business accounts can be registered under your company’s name, your personal details are not shared with customers. This provides an additional layer of privacy when you engage in transactions with your customers.
Furthermore, you may even receive periodic offers from PayPal for credit and loans. This is a profitable feature for business owners since you can use the credit amount to invest and grow your business during times when there is a lull.
To set up a PayPal business account, here are the things you may need:
This type of account takes longer to set up than a personal account but it is not really a hassle when you take into consideration the host of benefits you receive. Also, it is important to note that once you have a PayPal business account, you can’t downgrade your account to a personal account without contacting PayPal’s customer care.
Before you decide on which account you want to get, be sure to weigh the pros and cons. To help you get started, here are a few:
While you do not have to pay for setting up your account, maintaining it or even closing it, you will have to pay certain fees for transactions. Here are the fees you are required to pay:
Additionally, there is no fee for receiving money when there is no currency conversion involved.
When you receive commercial domestic payments, here are the fees that are levied:
Additionally, there are also fees for checkout and QR code transactions.
When you receive commercial international payments, here are the fees that are levied:
If you are looking for a PayPal account to primarily make online purchases, then personal is the way to go. However, if you will mostly be using your PayPal account while trying to grow your e-commerce business, then the business account is probably the way to go.
If you own a small e-commerce business, a PayPal business account gives your brand a professional look that consumers trust more. Not only does it benefit you by helping you gain trust more easily but it becomes easier to process online payments, send invoices to customers, or even opt for PayPal’s credit and loan options.
Again, a personal account is equally good for someone who is starting out but if your vision is to grow your brand quickly, the PayPal business account provides you with invoicing features, multiple account access and even printing the shipping labels.
If you are looking to use a PayPal business account, you also need to ensure that the order information gets synced in real-time to be able to get paid faster.
With a PayPal x TrackiPal integration, here is what you get:
Got your PayPal account set up? It’s time to sync your orders to it; get the TrackiPal app here.
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