In today’s digital world, PayPal serves as your secure, easy-to-use digital wallet, making it simple to send and receive payments without revealing sensitive financial details. Whether you’re launching a dropshipping business or looking to streamline your current operations, learning how to open a PayPal account is your first step toward smoother, safer online payments.

This comprehensive guide covers everything you need to know—from understanding what PayPal is and exploring the different account types and fees to step-by-step instructions on how to open and verify your PayPal account and link your credit or debit card. Ready to open a PayPal account and simplify your online transactions? Let’s start!

What Is PayPal?

PayPal is a popular online payment service that lets you send and receive money electronically. It offers a convenient alternative to traditional payment methods. Essentially, PayPal acts as your digital wallet, allowing you to store and manage your payment information securely online.

Using PayPal, you can make online payments without sharing your financial details with merchants. Simply link your credit or debit card to your PayPal account, and when you check out, select PayPal as your payment method. This way, merchants only receive necessary information like your name, email, and shipping address (if applicable), keeping your financial details private. This keeps your sensitive information—such as bank account numbers, credit card details, and billing addresses—secure and confidential.

As a digital wallet, PayPal employs advanced data encryption and anti-fraud measures to protect your information and minimize the risk of online fraud. Setting up a PayPal account is quick and straightforward. You can create an account in minutes, link your preferred payment method, and start making secure transactions immediately.

With over 400 million active accounts across more than 200 markets, PayPal supports transactions in over 25 currencies, making it a truly global payment solution. Today, PayPal is widely accepted by online retailers and service providers worldwide, making it a convenient choice for consumers and businesses alike. This widespread acceptance makes PayPal an excellent choice for dropshipping businesses, which often rely on quick, secure, and international payment processing to manage transactions with suppliers and customers across different countries.

Now that we have a basic understanding of what PayPal is, let’s go over the PayPal account types available.

PayPal Account Types

PayPal Account Types

PayPal offers two different account types. The first one is a personal account, and the second is a business account. 

Let’s go over the differences between the two.

Personal Account

If you are a regular shopper who shops online or wants to send money to friends and family, then a personal account is the way to go.

Business Account

If you are an online merchant who wants to get paid using PayPal, then you should open a business account

Keep in mind that no business documents are required to create a business account.

You can start selling online using your personal PayPal account, if you already have one. But, at some point, you’ll want to switch to a business account.

It is possible to upgrade from a personal account to a business account. Although, you can not do the opposite (downgrading a business account to a personal account).

If you don’t have a PayPal account, and are planning to start your dropshipping business on eBay, then we recommend you open a business account right off the bat.

Can I Have Multiple PayPal Accounts?

Yes. PayPal allows you to have up to two PayPal accounts. But, they have to be for different purposes. One for personal use, and one for business use. 

Now we know about the two account types, let’s move on to learn about PayPal Fees.

PayPal Fees

paypal fees

When we are using any service, we have to pay fees. And, PayPal is not an exception!

The good part is that any other competitor is paying fees too.

On PayPal, there is no subscription fee or any hidden fees. We don’t have to pay anything until we get paid for selling and receiving payments.

We only pay a selling fee when receiving payments.

It’s a small price to pay for accepting payments from any of the +286 million PayPal active customers worldwide.

Every supported country on PayPal has different selling fee rates. You can get to the list by clicking on the Fees link on their footer menu:

paypal fees section

On this page, we have a list of all the countries, regions, and currencies supported by PayPal. Here’s an example of some of the countries you’ll find on that page:

paypal supported countries

The supported countries are grouped by continents, making it easier to navigate through them.

You should be able to find your country there, as long as it’s supported by PayPal. Simply find your country, click on it and check your fees for incoming payments.

On the fees page, we have all the details that we need to understand how much to add to our break-even setting (total product cost). 

paypal selling fees

As you can see, the PayPal Checkout fees are 3.49% + fixed fee per sale. For US sellers, for example, the fixed fee is 0.49 USD.

paypal fixed fee

Select your country to check which fees are applicable to you.

Now that we’re familiar with the PayPal fees, let’s move on to open our PayPal account. After all, this is what you have been waiting for, right?

How To Open A PayPal Account

Opening a PayPal account is quick, free, and easy, as it should be. All you have to do is go to paypal.com and click Sign Up on the top bar.

paypal sign up button

Then, you get to choose which PayPal account type you wish to create:

how to open paypal business account

In this case, we will choose the Business Account and then click Get Started.

Now, fill in your First and Last name, email address, and password. We urge you to use a unique and difficult-to-guess password, as PayPal is your online bank! Click Agree and Create Account.

paypal account credentials

Next, you need to confirm your email with a code. Click Email you a code to receive a 6-digit number at the email you provided during the registration.

confirm email for paypal

In the next window, fill in the code you received. For security reasons, your code will expire in 10 minutes. If you can’t enter it in time, you can request a new one. Click Submit.

paypal account verification code

Congratulations—you created your PayPal account! However, we need to activate it first. Press “Let’s Go!” If you want to do it later, click Skip for now.

Paypal will ask you a few questions to better understand your requirements:

  • What do you plan to sell?
  • Where do you plan to sell?
  • How do you plan to accept payment?
  • What payment options do you plan to offer?

paypal account questions

Once you submit answers, PayPal will recommend a few tools depending on your answers. Tick the tools you are interested in and click Next.

paypal recommended tools

In the next step, you have to describe your business. In other words, choose the business type that you have.

For us, we have to pick either the Individual seller / Sole proprietor option if we are individual entrepreneurs or Company if we are incorporated under an LLC or any other type of business that can be run by multiple people.

ebay seller type

Since we are small entrepreneurs, we will choose Individual seller / Sole proprietor for now.

paypal business type

Next, you need to provide information about yourself for verification purposes. Ensure that your First and Last names are correct. Then, enter your date of birth by selecting the month, date, and year. Fill in your home address where you live most of the year. Make sure it matches the residential address on your tax documents.

paypal account business information

Then, enter the last digits of your SSN (for U.S. residents only). It is very important to enter the right information, as you may need to provide pictures of documents that have the same information. Once you have filled in all the required information, click Agree and Submit.

Boom! We have successfully created our PayPal account.

Now, let’s link a credit/debit card and verify it, so we can connect it to eBay to start sending and receiving payments.

Linking A Debit Or Credit Card With PayPal

link credit card

To link a debit or credit card with PayPal, start by logging into your PayPal account. 

On the top bar, hover over Finance, then click on Banks & Cards.

paypal linking a bank card

Next, scroll down to the Credit and Debit Cards section and click on the Link a card button to begin filling out the card’s information:

paypal link a card

Now, start filling in the debit or credit card details.

We need to fill out multiple fields: the card number, type, expiration date, security code (CVV), and billing address.

paypal account card information

As soon as you fill in the card number, PayPal will automatically then detect the right card type.

Make sure to verify that the billing address is the right address. 

Once done, click on Link Card.

paypal visa card linked

Boom! The card was linked successfully to our PayPal account. Now, just click “Done“.

PayPal will now redirect us to the money page. And as we see here, here is the card that we just linked.

paypal linked credit card

From this page, you can also link a bank account or another card, but one card is enough to begin.

In most cases, after linking our credit card, we will need to verify it on PayPal. We will cover this a bit lower.

How To Verify Your Credit Card

To verify that everything is up and running, hover over the profile icon at the top of the PayPal page, then click Account Settings.

accessing paypal account settings

Then, from the sidebar, click Money, banks, and cards.

paypal account settings

Now, we can see all the banks and cards linked to our PayPal account. Everything looks perfect!

However, in most cases, we will have to confirm our card after adding it to PayPal.

paypal card verification process

To do this, click on the Confirm your card link. Review the information and click OK.

PayPal will ask permission to charge $1.95 USD on the card. Accept it, and this charge and a 4-digit PayPal code will appear on your card statement within 2-3 business days.

paypal card get verification code

The next step is to wait at least one day, and then review your credit card statement on your credit card’s website or your bank account. 

There should be a $1.95 charge with a PP*xxxxCODE (x=4 digit code). 

Copy that four-digit code and head back to your PayPal account. Confirm your credit card by filling in that four-digit code.

paypal card verification link

Note that if you requested the PayPal code more than once, there will be more than 1 charge on your card statement. Use the latest code that you’ve requested.

paypal card verification code

Once you enter the verification code, you’ll get a confirmation notice. And that’s all there is to it!

Your PayPal account is now active, and your payment setting is confirmed.

paypal card verified

Conclusion

Now that you’ve learned how to open a PayPal account and navigate its features, you’re well-equipped to enjoy secure, efficient online transactions. With a solid understanding of PayPal’s account types, fee structures, and verification processes, you can confidently integrate this powerful digital wallet into your business.

Use PayPal to protect your financial information, enhance your customer trust, and streamline your payments. Embrace the ease and security of PayPal and take your online business to the next level!

Last but not least, continue learning to work your way to building your own success story: