It almost goes without saying that one of the main reasons you run a business is to make money. If you have a traditional “bricks and mortar” store, you can always accept payments from your customers simply by getting yourself a cash register or cash box.
Yet many businesses are exclusively on the internet. Then you need to figure out a way for your customers to pay for the goods and services you sell. For many businesses, PayPal has been the answer.
PayPal’s “Website Payments Standard” product is what many businesses use. There is no monthly fee associated with the service. It also allows businesses to accept customer payments via credit card.
The service works by providing customers a clickable button or link that takes them to the PayPal website when they are ready to purchase. The customer enters their information on PayPal, and is then returned to the business’s website after the transaction is completed. PayPal provides the shipping and other information to the business to complete the transaction.
Basic PayPal Set-Up
Set-up is relatively simple. Begin the process by signing up for a website payments standard account on PayPal. Provide your business information, including the bank account you want to link to your PayPal account. PayPal then provides you with tools to create the HTML code for the “Buy Now” or “Add to Cart” buttons. You can insert this code on the appropriate page of your website.
For an additional fee, PayPal also allows you to set up subscription services that your customers can buy. For example, a business that provides monthly reports can sell a subscription to customers who are willing to pay a certain price each month. Customers only have to provide their credit card information once.
PayPal also offers a service called “Website Payments Pro.” This provides you with the ability to accept customer payments directly on your website. This service costs $30 a month. It does require that you manage your own credit card data security infrastructure. This can be a daunting task for many small businesses. There are strict laws and regulations that apply. However, high-volume businesses may consider it worth the additional time and expense.
PayPal’s Fees and Charges
PayPal charges a fee for each transaction. The fee is based on the volume of your monthly sales. If your business does a monthly business of 50 transactions for $20 each, PayPal will take $44 of your $1000 as a fee. The fees generally decrease as the dollar value of your business increases. However, each individual transaction triggers a minimum 30 cent fee. If your business does lots of very low price or “microtransactions” online, then PayPal might not be an optimal solution.
PayPal has proven to be the convenient, reliable and reasonably priced service for a significant number of online businesses. It’s convenient for your customers. And it’s a fast and easy way to collect payment.