Online transactions are one of the most useful trade techniques, owing their success to the propagation of the Internet. However, the single downside that most online money exchange facilities have to deal with is security.
Among the few online purchase and money exchange platforms that have gained widespread acceptance due to its secure transaction management is PayPal, one of the most trusted money transfer services since 1998.
PayPal has enjoyed widespread acceptance ever since, owing mainly to its design which masks the financial data of both the sender and the receiver, through the use of email addresses to direct fund requests and receipts.
In the past years, PayPal has established a track record of serving 170 million Internet users. Further, PayPal has captured a sizeable market percentage (45%) of eBay purchases and successfully handles up to $7000 in online transactions on a daily basis.
What are the Most Important Benefits of PayPal
- Popular and Widely Used: PayPal is one of the most widely used services with formal policies entailing integrity and guarantees for online transactions, that work for both parties involved, enabling not just smooth transaction completion, but also guided protocols for steady recovery of funds when the need arises
- Available in a Wide Variety of Online Transactions: PayPal can be used not just to make online purchases from e-commerce websites, but also an alternative mode of payment eliminating the need for supplying credit card information every time. PayPal can also be accepted to pay for your online subscriptions or repay borrowed money from family or friends
- Easy to Accomplish Financial Transactions: The ease of use of PayPal requiring just email addresses for completing transactions makes it suitable for both beginners and experienced business owners globally.
- Secure Transaction Processing Protocols: By concealing user financial data supplied to PayPal (bank account and credit card), PayPal allows users to complete paperless transactions securely.
Why Users Sometimes Complain About PayPal
The most frequent source of customer dissatisfaction related to PayPal use is tied to its exorbitant currency conversion rates, which surpasses charges levied by most banks. Moreover, PayPal also charges an additional 2% for converting currency. In general, PayPal has a reputation for being more expensive than any other online platforms operating in the money exchange and cross-border transaction space.
In addition, PayPal can be a source of inconvenience especially to business users owing to its stringent security measures that are highly sensitive to fraud. This means that PayPal might resort to freezing your account at the slightest sign of suspicious transactions, creating unprecedented delays in business dealings and losses until the matter is cleared satisfactorily.
PayPal staff also has a reputation for being unresponsive and inattentive at times, during their phone support. Customers also complain about high rates of interests and an additional fee charged in certain scenarios like late fee and incremental fee, for which they are unprepared. Even when customer complaints are resolved by refunding, the lack of proper planning leading to overcharging customers has created a bad reputation for PayPal.
In Spite of the Downside, PayPal is Still One of the Most Trusted Platforms. Here’s Why
PayPal wins over most competitors through severe security checks built into the system:
- It uses the most contemporary technology to counter risks, detect or prevent suspicious activity and secure users from identity theft
- PayPal offers 100% fraud protection through additional email confirmations, verification checks, and a full-fledged analyst support, should a dispute take place
- PayPal buyer protection is available to certify the trustworthiness of sellers and allows certain high-value transactions to be insured
The Most Basic PayPal How – Tos
PayPal makes some of the most important online transactions available through a simple online interface. Basic operations involved in using PayPal include:
Setting up a PayPal Account
In order to create a PayPal account, you must connect your email address, bank account (available in one of the 100 PayPal approved countries) and credit card information to your PayPal identity. For multiple credit cards attached to your account, one can be designated as primary for online transactions. However, fund allocation can happen from any of your money sources.
You can either setup a personal account to be able to send money in 55 countries, accept payments or perform online shopping. However, the personal account is limited concerning not being able to accept debit or credit cards for online transactions and has a cap on the sales made per month.
The PayPal business account, on the other hand, is suitable for high volume sales, integrated with eBay reporting tools. Many optional business support services are also available. PayPal also allows the convenience of being able to upgrade a personal account to a business account.
Paying for Transactions Using PayPal
PayPal can withdraw against your credit card or bank account when a purchase is made without any additional fee, even without a PayPal balance. In this case, PayPal debits your primary source in 2 business days as long as it is within the available PayPal credit limit. Alternatively, you can transfer money to create a PayPal balance, free of interest or fee, as a more acceptable and secure way to pay for transactions.
Withdrawing Money from PayPal
When you receive funds from your buyers, PayPal wire transfers the amount to your bank, without any fee. This will happen in eight or fewer business days, before the funds are available for use.
What Kind of Fee and Surcharge Might You Incur with PayPal?
PayPal operates primarily through surcharges attached to various scenarios as outlined below:
- When goods are sold, sellers must pay a 30 cent fee, in addition to 1.9 to 2.9 % charge on receiving payment.
- In case if the money is sent outside the country, a surcharge of 2% is included in general, and an additional charge is also recovered when credit cards are used.
- When receiving funds exceeding $3000 in value, up to $100,000, a surcharge of 1.9% to 2.9% is levied with surcharge progressively diminishing as amount transferred increases.
Overall, PayPal has managed to create a positive impact on securing a sizeable portion of e-commerce transactions available online. It encouraging users to concentrate on their business itself, and directing transaction risk to one of the most qualified services available today.