Here’s some good news for newbies setting up their business online. PayPal for small businesses not only makes it easier to accept payments but also provides countless other benefits to help you improve your services.
With the right kind of tools, you can quickly boost your customer count without any hassle. Let’s assume that the one thing you’re trying to perfect is completing secure online payments without inconveniencing your customers. If so, you’ll likely come across PayPal in your journey to find a possible solution.
Currently, more than 325 million users have active PayPal accounts around the globe. It operates with all major supported currencies worldwide. But the question remains, “Do you think PayPal would be the perfect solution for your business as well?” There’s an easy way to find out!
Let’s first look into the pros and cons of PayPal Business Account.
Pros & Cons of PayPal Business Account
1. Easy To Set Up
PayPal accounts are quite easy to set up. You simply need to visit their official website, choose the business account type for your small business and provide some personal information, including email ID, full name, password, and you’re good to go.
It’s a very safe service, especially for buyers. As for sellers, it can pose some risks, such as data breaches and system glitches, but that is common with online payment processors. Luckily, PayPal has enough security protocols to keep you and your business relatively safe.
2. No Need to Own a Merchant Account
The best part about using PayPal for your business is that you don’t need to own a merchant account. PayPal merchant account-holders pay additional costs, including application charges, monthly fees, cross-border fees, pre-transaction fees, as well as rental fees for a credit card terminal.
Merchants accounts used to be necessary to accept online payments, but not anymore. This makes PayPal ideal for businesses that want to get started quickly and inexpensively with online transactions.
3. More Affordable Than Other Online Payment Methods
As we discussed above, PayPal operates without a merchant account, making it a cheap alternative to other online payment methods. Currently, merchant accounts charge an extra 2.9% on top of $0.30 fees for credit card and debit card purchases. On the other hand, PayPal allows for transactions at a more affordable price.
4. Allows Exchange of Invoices
PayPal hosts a “PayPal invoicing” feature to generate professional invoices in less than a minute. These make it easier for customers to pay and help you in tracking payments received over time.
5. Works With Multiple Shopping Cart Systems
If you just initiated your business website and don’t know which type of shopping partner you need, we have good news for you. PayPal is integrated with many shopping cart systems, so you can start accepting your payments right away. Prominent available shopping cart systems include Shopify, Magneto, CS-Cart, Big Cartel, and Volusion.
1. Hefty Fees for Chargebacks
A chargeback is a reversal of payment – money is taken out from the seller’s account and returned to the buyer. PayPal allows for chargebacks, but the process is a bit more complicated than usual. Not a good sign for your small business!
Payment services like PayPal are equipped with a form of buyer’s protection. This is to provide a sense of security to the customers, who will be relieved to know that they can get their money back if their purchase does not go well. If you have to return a payment to the buyer, it’ll cost you a hefty fee.
PayPal authorities reserve the right to freeze your account without any prior notice. Consequently, your collected funds will be blocked until the account is reactivated. This has caused frustration among users who claimed the PayPal team didn’t point out any legitimate reasons for account suspension.
Although its use is on the rise, PayPal is still a relatively new member in the world of electronic and online payments. Therefore, many people refuse to make the switch to it just yet, resulting in business loss.
3. Customer Support Service Not Readily Available
Although PayPal has an active phone number for customers to ask questions or report unauthorized transactions, it’s often difficult to contact their representatives. Alternatively, you can reach PayPal support via their official page, but it could take up to a week to receive a reply to your email.
How Can PayPal Help You Grow Your Small Business?
Let’s not forget that your small business needs an online presence first. More importantly, a website crafted with a professional design makes it stand out from the crowd. Whether you’ll launch an online store or an eCommerce website, you need a domain. Lastly, make sure you choose the right web hosting plan that fulfills your business needs.
The need for electronic payment has grown as more and more businesses have shifted to online sales. Many entrepreneurs have shared that their digital platforms generated higher profits compared to their non-digital counterparts.
78% of customers shop for their favourite products online. It provides more security, saves time, makes it easier to complete a transaction quickly, and offers a reliable support service.
If you’re looking to grow your small business, having a reliable online payment method is extremely important. First of all, PayPal for small businesses lets you accept different types of payments. At “PayPal Checkout,” your customers will be informed about relevant payment options. PayPal doesn’t direct customers to third-party websites to complete the transaction. This will let them transfer you the purchase amount without leaving the website.
It’s proven that 17% of buyers lose interest in online purchases when they can’t pay the business directly and have to complete the transaction via third-party websites.
PayPal also lets you add payment buttons to your websites without any professional help with no additional fee. There’s only a transaction fee when you receive payment.
If you’re looking for a more customizable solution, consider PayPal Payment Pro. It lets business owners create a unique checkout process different from other online stores, which is a great way to set yourself apart. With PayPal Payment Pro, you can choose the colour, layout, and language of your choice.
PayPal payments can also be completed via the virtual terminal. This portal lets you transfer the amount over the phone, via fax, or by mail. All you need to do is provide the customer’s credit card information. However, you will need to pay $30 USD per month and a per-transaction fee.
All this talk of using PayPal for online transactions might make you think that PayPal wouldn’t be useful if you invest in-store or on-the-go business, but it’s great for those transactions, too!
PayPal Can Be Helpful For In-Store Purchases
Just because buyers are paying in-store doesn’t mean they’ll be carrying cash. Payment systems have evolved, and businesses need to quickly adapt to new consumer behaviour. Because many customers choose to make electronic payments, having a PayPal account ensures you can accommodate this choice. PayPal lets customers pay via smartphone or tablet. It generates QR codes that eliminate the need for cash or cards.
At the time of purchase, buyers only need to open their PayPal account and use the unique QR code. The amount will be deducted from their online account, and you will receive the payment quickly. Businesses’ can create their own free codes that never expire.
Whether you decide to add PayPal to your business’s existing list of payment processors or you use it as a primary option, PayPal can do a lot to help you. Consumer behaviour is rapidly changing, making it more apparent than ever that online purchases are rising.
As an entrepreneur, a digital marketer, or a freelancer with an online gig, considering opting for a PayPal account. Just don’t forget to make sure you learn how to make the user’s payment processing experience convenient and smooth.
Please note that the pricing in this blog post is current as of the date of publication and is subject to change at any time.
Faisal Rehman is a Freelance Systems Administrator and a writer at softwarespice.com. He has 10 years of technology and systems experience. During his free time, he hangs out with his family and kids, plays with them, and watches cartoons.