How to Receive Money on PayPal?
Over the recent years, the name Paypal has become synonymous with online payments. Paypal, not only revolutionized the online money transfer ecosystem, but also changed the way people made payments, ever since its inception. One of the biggest benefactors of Paypal have been freelancers across the globe. It has made remote working a lot more easier, as the pain point of collecting payments internationally, through an absolutely safe, legal and efficient manner was addressed by the introduction of Paypal.
Freelancers and Digital nomads now do not have to restrict or compromise on their lifestyle to work on projects, largely due to two major breakthroughs in the 21st century. The primary reason being easily accessible high speed internet, which just makes working remotely actually possible. The second reason is predominantly being able to quickly get paid for the work, without having to worry about being scammed or waiting for weeks and months before you're paid for your hard work. The invention of Paypal has also drastically reduced the hassle that comes from coordinating with banks. What the payment is for, a few clicks and the money is in your account. Just that simple.
Paypal is not just used by freelancers and Digital nomads to collect money, it’s also widely used to make online purchases, or to transfer funds to friends and family. Especially overseas payments. While Paypal is considered a more expensive online payment option, it is one of the most widely used ones.
So, since Paypal is an easy mode of collecting money, how do you receive money from Paypal?
Setting up your Paypal account
To receive money from PayPal, it is imperative that you have a Paypal account. Paypal classifies its users broadly into three main sections. Individuals, Businesses and Shoppers. The rules for businesses and individual users (Freelancers) are largely the same. To set up a Paypal account, you need an email address, all the information about your business, the company name, address and PAN card. You will also have to link a bank account with your Paypal account. Once your details are verified, you are all set!
For Shopping accounts, a name and email address is still a prerequisite. You need an address, a mobile number and a pan card for tax verification. You can link your bank account and your debit/credit cards to your Paypal account.
Requesting a payment via Paypal
One of the most fascinating things about Paypal, is that you can request a payment from anyone that has an email address. Which is literally everybody. Just login to your PayPal account, click on tools and request a payment.
As soon as you enter your email address, Paypal will generate a link, and send it to the email you’re requesting a payment from. The best part is, the customer who has to make a payment towards you does not need to have a Paypal account in order to transfer to your Paypal account. The payment can be made with a credit card, debit card or with a Paypal account. Once the customer makes the payment, you will get a notification stating the funds have been credited to your account.
Through Paypal, business accounts can also raise an invoice. Paypal invoices are extremely customizable. You can add your company logo, invoice numbers, schedule payments and the relevant currency for your payments. Once you have updated your invoice, Paypal generates a link just like when you request a payment. Then, your customer can click on the payment link emailed to them to make the payment, either with their Paypal account or with their credit or debit cards.
See also: PayPal Currency Converter Tool
Paypal.me is a great tool for freelancers who don't have the infrastructure of a full fledged business, or for individuals collecting money for social causes. It’s a customizable link that can be shared via social media and used to collect money. Once your customization is approved, you can share this link with your customer(s) to collect multiple payments without any hassle. Paypal payments take between 3 to 5 business days to credit to your account. So ensure you are scheduling your invoices, and have factored in the timeframe.
Paypal payments can also be sent to email ids that do not have a Paypal account. Or better yet, do not have a bank account linked to them. However, the only way you can withdraw the funds transferred to your account and truly claim your money is through a Paypal account. So ensure your bank account is linked. Follow the steps mentioned below to receive money into your bank account from your Paypal.
- Login to your Paypal account. On the summary page, click on the ‘Transfer Money’ option, just below your Paypal balance. You can also use the ‘Wallet’ screen to access the ‘Transfer Money’ option.
- Once you are on the ‘Transfer Money’ screen, click on ‘Transfer to your bank’. If you have multiple bank accounts linked to your Paypal, choose the one you want to transfer money to, and click on next. Enter the amount you want to transfer and click next. You will be asked to review the transfer. If everything is correct, Click on ‘Transfer (the amount) here now’. Your money will be transferred to your account.
- There’s also an auto-transfer feature for Indian accounts, where the funds received into Paypal accounts are auto-credited into the Indian bank account that is linked with it, within 24 hours.
So this is how you collect payments with Paypal and it’s really simple too. However, Paypal is one of the more expensive payment processors and charges about 2.5% in transaction fees alone. So keep this in mind while collecting payments and raising invoices. If you think Paypal is too expensive, you could consider some alternatives to Paypal to reduce the percentage of transaction fees and increase your profits!
See also: How to Reduce PayPal Fees?