PayPal - A Safe, Secure Option for Small and Medium Businessmen
PayPal is a debit card usually attached to an online account. The card can be used for purchases, withdrawals from ATMs, and remittances of funds. Funds can be transferred between PayPal accounts and cards, personal or business accounts in up to 120 countries and regions at over two million banks worldwide including American Express®, MasterCard®, Visa®, Discover Card® and Diners Club International.
This blog post will discuss the pros of using PayPal for small & medium business owners as well as the cons of using PayPal in your operations.
Pros:
Acceptance into more than 200,000 locations worldwide: As the third largest online payment provider, PayPal provides acceptance into hundreds of thousands of merchants worldwide. These include retailers such as Wal-Mart, Best Buy, Home Depot, Sears and Kmart and large corporate organizations such as Google, Yahoo!, eBay and AT&T. PayPal's international presence makes it easy for small business owners to sell to global markets. There are also several ATM systems that allow users to withdraw funds from their account using a debit card which make it easier for business owners to pay their employees via payroll.
PayPal provides acceptance into hundreds of thousands of merchants worldwide. These include retailers such as Wal-Mart, Best Buy, Home Depot, Sears and Kmart and large corporate organizations such as Google, Yahoo!, eBay and AT&T. PayPal's international presence makes it easy for small business owners to sell to global markets. There are also several ATM systems that allow users to withdraw funds from their account using a debit card which make it easier for business owners to pay their employees via payroll. Convenience: Having a debit card attached to your account allows you to receive payments much more quickly than if you were sending checks or money orders via snail mail. When a customer makes a purchase from you online, he or she will enter in his or her credit card information and the debit card information will be automatically attached to the transaction. If you sell at a brick & mortar location, your customers can use their debit cards to purchase goods from your store. You also have the option of creating an invoice which is attached with the payment and sent via email or printed paper.
Having a debit card attached to your account allows you to receive payments much more quickly than if you were sending checks or money orders via snail mail. When a customer makes a purchase from you online, he or she will enter in his or her credit card information and the debit card information will be automatically attached to the transaction. If you sell at a brick & mortar location, your customers can use their debit cards to purchase goods from your store. You also have the option of creating an invoice which is attached with the payment and sent via email or printed paper. Low Fees: Small businesses who use PayPal will find that they are paying less in fees than they would be if using other methods of payment. With PayPal, you pay 3.4% plus $0.30 for each transaction (minimum costs $1). This is significantly less than the 14¢ per transaction charged by credit card companies like Visa, MasterCard and American Express. You also pay no fees to receive payments.
Pros:
Accessibility: As a payment method that is accepted into all of the top online retail stores you can be assured that your customers will be able to use the card on your behalf. This means that if you are selling items online, your customers can conveniently order from your Web store, Amazon or eBay account without having to take out cash from their checking account. Or, if you want to sell your products at another brick & mortar location in town, PayPal makes it easy for people to use their PayPal debit cards when making purchases at your retail store.
As a payment method that is accepted into all of the top online retail stores you can be assured that your customers will be able to use the card on your behalf. This means that if you are selling items online, your customers can conveniently order from your Web store, Amazon or eBay account without having to take out cash from their checking account. Or, if you want to sell your products at another brick & mortar location in town, PayPal makes it easy for people to use their PayPal debit cards when making purchases at your retail store. Easy Interchange: When you deposit money into a bank account it is often subject to a 1-3% fee for the service. PayPal charges you nothing to transfer your money.
When you deposit money into a bank account it is often subject to a 1-3% fee for the service. PayPal charges you nothing to transfer your money. Back Up Options: If you are ever concerned about your security when using PayPal, there are several other ways to back up your transactions. You can request a check or allow the buyer to download a PDF invoice for their records.
Cons:
Chargebacks : Businesses who use PayPal as their primary method of accepting payments will experience chargebacks more frequently than if they were to process payments through credit cards. Chargebacks occur when a customer disputes a purchase. When this happens, PayPal will carry out the chargeback procedure in accordance with the terms of the seller's agreement with PayPal. This means that you can be liable to the buyer for every penny they are owed, and there is no recourse for you. It will take anywhere between 30 and 90 days to get your account back up and running after a chargeback has been filed against you.
: Businesses who use PayPal as their primary method of accepting payments will experience chargebacks more frequently than if they were to process payments through credit cards. Chargebacks occur when a customer disputes a purchase. When this happens, PayPal will carry out the chargeback procedure in accordance with the terms of the seller's agreement with PayPal. This means that you can be liable to the buyer for every penny they are owed, and there is no recourse for you. It will take anywhere between 30 and 90 days to get your account back up and running after a chargeback has been filed against you. Chargeback Fees: In addition to dealing with potential losses from chargebacks, PayPal also charges you a fee if it ends up filing a chargeback on your behalf. This fee is reversed if the transaction turns out to be legitimate but most times this won't happen.
In addition to dealing with potential losses from chargebacks, PayPal also charges you a fee if it ends up filing a chargeback on your behalf. This fee is reversed if the transaction turns out to be legitimate but most times this won't happen. Risk: While PayPal claims that the money goes directly from the buyer to the seller, using PayPal is not as risk-free as when using credit cards. This is because there is no third party involved and there are less regulations in place. This means that you are at greater risk of losing your money if something were to go wrong with your transaction.
Conclusion:
PayPal was built to make online purchasing easier. As a PayPal account holder you can access funds sent to your PayPal account from anywhere in the world, and you can check your balance using any Web browser. This makes it very easy for you to track your money when transacting with customers, and you will also find that using PayPal is secure as there are no third party connections or credit card information needed so your business can remain completely anonymous.
When it comes to working with the service, there are really only two choices. You can choose to have all of your transactions processed through the bank that is linked to your PayPal account.