PayPal is an online
payment system, which is used to make money transfers between users and/or
companies, without the need to share financial information from either party.
It is an alternative
to traditional methods, such as money orders or checks, and was born as a
result of the suspicion that existed a few years ago in relation to making
purchases and other economic operations through the Internet.
In other words, PayPal
is a kind of virtual wallet through which it is possible to carry out all kinds
of monetary operations without the need to provide personal or bank details on
each of the platforms with which these transactions are carried out.
This payment processor
saves and protects the data of its users and acts as an intermediary between
both parties, taking a small commission in return.
What were the origins of the PayPal
company?
The multinational is
of American origin, is called Paypal Holdings, Inc. and is headquartered in San
José (California). It was founded in 1998 under the name of Confinity, and in
2000 it merged with X.com to, a year later, adopt the name with which it has
spread throughout the world and is still known today.
It must abide by the
rules of the United States Department of the Treasury and the European Union
Financial Services Authority, although the latter, which was acquired by eBay
in its early days (2002) and which since 2015 is already an independent company
It doesn't work like a bank.
This payment system
with which the US company operates, which at the beginning of 2017 exceeded 200
million active users, offers great security to those who use it, not only
because of the rigid data protection policy that it implements.
Also because it looks
after the interests of buyers by offering up to US$2,500 as compensation in the
event of certain setbacks, perfectly described in its conditions of use.
At this point, if you
do not have an eCommerce, you may have a question:
Can I create a personal PayPal account
for my online transactions as a private user?
Of course. In fact,
this platform is the most used to open these types of accounts. If you are
wondering why, I encourage you to keep reading until the end and see how many
advantages it has.
However, now that you
know what this service is and what it is for, you may not know how it works in
detail. For this reason, I like to tell you all the secrets of this fantastic
online platform for sending and receiving money on the Internet.
So before I explain
how to create an account, I'll start by looking at how this tool works.
How does PayPal work exactly?
Through an automatic
encryption system, and advanced anti-fraud systems that the company
periodically renews and reinforces, the personal information of the users who
use it is perfectly protected and safe from possible risks.
These, however, with
the advances in computer security that have occurred in recent years, are less
and less. It is important to emphasize again that this platform does not work
like a traditional bank, although it is governed by some common rules.
At present, its
services are exclusively dedicated to paying for purchases and sending or
receiving money safely and not saving capital like most banks.
Does PayPal charge any commission
for transactions made?
For each transaction
made, this platform charges the recipient of the money a commission that ranges
from approximately 1.9% to 3.4% in addition to an extra 35 cents.
Likewise, it also
charges for applying currency conversion in international operations. It is a
variable fee that responds to currency market conditions and is usually between
2.5% and 4%.
However, this platform
allows the currency exchange to be provided by the credit card entity in the
event that the payment is to be made in a currency other than the main one.
In summary, PayPal
only charges a commission to the seller for using its platform as a collection
system. All actions carried out by a user with a buyer profile are completely
free.
This American company
leads the market for online payment systems and its turnover is increasing
progressively. In fact, the latest data is that the company already exceeds
1,300 million euros.
A fact that has helped
its value grow enormously on the stock market until it recently surpassed that
of a giant like American Express.
What are the advantages of using the
PayPal platform?
Creating a PayPal account has many advantages.
In fact, I would dare to affirm that having an account on this online platform
only has advantages and practically no disadvantages.
Therefore, I will
break down all of them, step by step:
1. Accepted in most online stores
This online payment
method, contrary to what happens with other payment methods that you will also
know, such as cash on delivery, debit card payment, transfer or online banking,
is accepted by most online stores.
It is therefore much
more convenient to have an account with which to be able to pay in all of them
than several accounts of other online payment systems, only valid for a few
eCommerce.
2. Easy to share with others
When it comes to having
to share your bank account information to receive income from a gift, customer
invoices, etc., it is much easier to do so by providing your email account
associated with this platform.
3. It does not lead to errors in the
numbering of the account number
Here comes to mind the
classic mistake when, a few years ago, we spelled out all the figures in our
bank account one by one, when having to receive a payment from another person
or entity.
4. Creating a PayPal account is
totally free
It is mainly one of
the reasons that push most people to open an account on this platform.
Although in case you
had to pay a certain amount to create it, I think it could be very profitable
to do it only at the beginning, to later be able to enjoy all its advantages.
In short, whether you
need a personal or business account, so far this is completely free.
5. Compatible with most currencies
Receiving or sending
money with it no longer implies the barrier that existed a few years ago when
you wanted to send money (or receive it) to another person or entity in another
country, in which there was another currency other than yours.
6. Security for your banking privacy
This is another of the
most popular advantages among users who are more suspicious of their personal
and bank details, concerned about preserving them and not sharing them with
other people.
Having an account on this platform, only by sharing the email address will we be able to carry out the transaction.