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PayPal Review: Is It Right for Your Processing Needs in 2024?

Dawn Prevete Dawn Prevete Finance Specialist

PayPal offers online and in-person payment solutions and a simple application and approval process without underwriting. Features include e-commerce tools, various payment methods, chargeback and seller protection, and 25+ types of currency accepted. But despite its popularity, PayPal’s fees are fairly high. Before committing, take a look at our top recommended payment processors.


POS equipment Zettle by PayPal terminals and mobile card reader, Store Kits, and accessories (dock, printer, and dock, stand available for purchase)
Payment methods accepted Credit and debit cards, Apple Pay, Google Pay, ACH, bank transfers, PayPal Pay Later, Venmo, cryptocurrency
Payout times Instant payout to PayPal business account ($25,000 maximum), 1-3 days to transfer funds to a linked bank account
Contract length Monthly (no cancellation fees)
Customer support Phone support Monday to Friday from 9 a.m. – 6 p.m. EST, live chat, an online community, and a resolution center for transaction or account issues
Security Level 1 PCI-compliant, 24-hour fraud monitoring, data encryption, chargeback protection

A Popular, User-Friendly Payment Processor

PayPal for business homepage.
PayPal is one of the most widely recognized names for payment processing

PayPal is one of the most well-known payment methods, trusted by businesses and consumers across the globe. As a payment processor, some of PayPal’s biggest pluses are its no-fee monthly plans, easy setup, fast payouts, and the financial services on offer, including business credit, debit cards, and business loans.

You can complete its no-fuss application process online in minutes without worrying about underwriting or credit history. That’s a boon if you’re just starting out, your sales are seasonal, or your transaction volume is low.

But however enticing it may seem to choose PayPal for your processing needs, its features come at a price. I found its transaction fees to be on the high side, plus you’ll need to pay for your point-of-sale (POS) terminal or card reader, and some fraud prevention and other tools cost extra.

After researching everything PayPal offers, comparing it to its competitors, and reading hundreds of customer reviews (both positive and negative), I realized that PayPal can be a decent option for brand-new, seasonal, and small businesses that want to start accepting payments quickly.

But as your business grows, you’ll find that other credit card processors offer better value. Review our roundup of the best credit card processing companies in 2024 to learn which might be a better solution for your business needs.



Accept Secure Online and In-Person Payments

When you choose PayPal as your payment processor, you’ll benefit from its global name recognition. You’ll also enjoy solid solutions for both online and in-person payments via its different software applications.

PayPal’s research shows that consumer familiarity with the service can boost conversion by as much as 30% because customers feel more confident about making a purchase.

Easy E-Commerce Solutions

PayPal gives you everything you need to process online, keyed-in, or mobile payments for products and services. It offers a secure payment gateway, virtual terminal, invoicing capabilities, and recurring billing and subscriptions. If you mainly sell online, PayPal makes it fairly easy for your customers to have a fast, mobile-friendly checkout experience.

One of PayPal’s most popular e-commerce features, Pay Later, allows your customers to pay in 4 interest-free installments (up to a value of $1500), which may increase your online sales and the value of each order. PayPal will pay you in full for installment purchases and take care of the billing for you.

In addition, PayPal’s mobile app lets you manage sales and inventory, send invoices, and accept payments on the go. It’s free to download and use for both Android and iOS.

Proprietary POS Terminal, Card Reader, and Accessories – At a Price

If you want to sell online, you can purchase one of PayPal’s “Store Kits,” which includes Zettle by PayPal POS card readers, terminals, and systems. None of the equipment is free, and you’ll also need to pay extra for accessories like a barcode scanner and dock (for printing receipts).

PayPal POS equipment optinos.
PayPal offers Zettle POS card readers, terminals, and store systems for purchase

Terminals come built-in with the PayPal Zettle app, which lets you manage all the details of your business: products, pricing, inventory, invoicing, and more. You can also download the app to your smartphone or tablet for use with the card reader.

If you are unhappy with the service and want to return the equipment, you’re unfortunately out of luck. PayPal only accepts returns for terminals, card readers, and accessories in the original, unopened box.

This is why choosing PayPal can be more costly than other payment processors like Leaders Merchant Services, which offers free POS equipment.

Fast Payouts and Various Accepted Payment Methods

While PayPal has its flaws, fast payout is not one of them. PayPal will deposit funds for completed transactions to your PayPal business account within minutes. But if you want to transfer these funds to your linked bank account, the standard payout time is 1-3 days. Need an instant bank transfer? You’ll be charged a 1.50% transaction fee.

Another PayPal strength is the number and type of accepted payment methods. Customers can pay with major debit and credit cards, ACH transfers, digital wallets (Google Pay, Apple Pay), and cryptocurrency. Naturally, it also accepts payments with its proprietary methods: PayPal, Pay Later, and Venmo.

If you sell to a global clientele, you’ll appreciate that PayPal supports over 25 currencies and dozens of international payment methods, including local credit/debit cards (Maestro, JCB, etc.) and other alternative methods like Alibaba’s Alipay.

It’s important to note that PayPal adds a 1.50% fee to all international transactions accepted by domestic US-based businesses.

Financial Products to Grow Your Business

Business funding, no-fee credit (and debit) cards, and working capital loans are just some of the financial products PayPal offers to help small businesses grow and thrive.

PayPal financial services
PayPal offers easy access to funding for small businesses

The minimum eligibility requirements for a capital loan are basic: all you need is an active PayPal Business or Premier account that’s at least 90 days old and payments of $15,000 (for Business accounts) or $20,000 (for Premier accounts) received during the last 12 months. If approved, you’ll pay off your capital loan with a percentage of future sales.

For business loans, PayPal pulls a hard credit check. Still, approval is fast, and PayPal will deposit funds to your PayPal Business account within 24 hours.

If you’re looking for fast credit, another financial option is the PayPal Business Cashback Mastercard. This card includes a number of perks like unlimited 3% cashback on purchases and free cards for your employees, which can help you keep on top of expenses. To qualify you’ll need to have been in business for a full year, have an annual revenue of $5,000 or more, and pass a hard credit check.

Integrations With Popular E-Commerce and Business Tools

PayPal integrates with a range of applications, from e-commerce platforms like Shopify WooCommerce, BigCommerce, Wix, and Squarespace to QuickBooks, SalesVu, JotForm, and other business and accounting software programs.

You can also integrate PayPal with third-party marketplaces like Etsy, eBay, or Depop.

PayPal integrations.
PayPal integrates with business, marketing, and e-commerce platforms

Integrating your PayPal business account with QuickBooks will automatically sync your sales, inventory, payments, and invoices.


Ease of use

Fast and Easy Account Setup

When I set up my PayPal Business Account, I found the process was easier than most other processors – all it takes is a few minutes. The quick approval and user-friendly interface are two of the biggest advantages of using PayPal as your payment processor.

Integrating PayPal with your e-commerce website and shopping cart is equally easy, and you can start invoicing customers, accepting payments, and tracking sales and profits on the same day.

Getting Started With PayPal

To get started, simply fill out the online form with your full legal name, email address, and account password. After clicking Agree and Create Account, you’ll be asked to supply basic information about your business (e.g., whether it’s a sole proprietorship, corporation, or nonprofit).

PayPal online form - create an account.
PayPal’s application process is fast and painless – there’s no underwriting

You may also need to provide information about the type of product you sell and your estimated monthly sales volume. After you verify your personal information and link your personal or business bank account, you’re all set.

PayPal doesn’t vet your business, underwrite your application, or check your credit history. This makes it ideal for new businesses and those with a limited processing history.

While the lack of underwriting gets you up and running quickly, there is a significant downside. During my research, I uncovered complaints about the algorithm fagging transactions, putting funds on hold, and canceling accounts without warning.

If your business is high-risk (and you don’t want your transactions to be unfairly flagged), you may want to consider Leaders Merchant Services. It has a 98% approval rate and a swift onboarding process.

PayPal Makes Managing Online Sales Easy

PayPal’s wide acceptance as a payment method on e-commerce platforms is a big plus. The beginner-friendly software makes it easy to integrate PayPal with your online store’s website or shopping cart in a few easy steps – no coding required.

Once you’ve set up PayPal Checkout on your site, your customers can pay however they want: by credit or debit card, PayPal payments, and much more.

View and Manage Reports for POS Sales

Log in to your PayPal Zettle dashboard to track and manage your sales, view pending deposits, and get detailed customer data. You can also see a summary by day, week, month, year, or a custom date range. Once you’ve customized your settings, you can download the report as an Excel or PDF file.

PayPal Zettle reports dashboard
Within PayPal’s dashboard, you can see a custom summary of sales data

The Zettle dashboard can also gather information about your customers (new or returning) and learn which products are most popular with shoppers. Other tools allow you to track sales data by employee, which can help you improve your business’s overall performance.



Seemingly Transparent but Be Aware of Extra Costs

PayPal’s pricing is one of the more straightforward I’ve seen from a payment processor: there’s no monthly plan, cancellation or PCI compliance fee, and its website clearly displays its transaction fees. But if you dig down, you’ll face dozens of different fees for transactions, products, and add-ons. Your potential costs can add up, especially if your sales volume is high.

PayPal’s pricing became very confusing when I tried to pin down the percentage markup and fee for different types of transactions (online, swiped, keyed in, QR code, etc.) and payment methods. PayPal’s downloadable PDF of transaction fees and what it calls its “products” runs 40+ pages.

I’ve summarized some of the most common fees below for US dollar transactions.

  • In-person credit and debit cards: 2.29% + 0.09¢
  • Online credit and debit cards: 2.59% + 0.49¢
  • Online payments using PayPal: 3.49% + 49¢ (online)
  • Keyed in transactions: 3.09% + 49¢ (keyed in)
  • Invoicing transactions: 3.49% + 0.49¢
  • PayPal QR code payments: 1.9% + 0.10¢
  • Micropayments (low-value transactions): 4.99%
  • Charity donation transactions (IRS 501C3 organizations): 1.99% + 0.49¢
  • Donations with PayPal button: 2.89% + 0.49¢

Unlike Leaders Merchant Services or PaymentCloud, PayPal won’t offer you a free POS terminal, so you’ll have to factor in equipment costs if you’re considering PayPal and have a brick-and-mortar store as well as an online store. A single mobile card reader from PayPal costs $29, but basic terminals range from $199 – $269. Complete POS store systems will run you over $699.

While PayPal’s $20 chargeback and $15 dispute fees are comparable to other credit card processors I’ve researched and reviewed, its transaction fees are pretty high. If you have an established business with substantial sales volume, PAYARC’s membership model can save you a lot – in addition to a monthly fee, you’ll pay a small transaction fee of 0% + 15¢ (in-person & online).


Compliance & Security

A PCI-Compliant Processor With AI-Powered Security Tools

In addition to being Level 1 PCI compliant, PayPal offers 24/7 transaction monitoring, data encryption, and various other services to protect sellers.

When you use PayPal to process card payments, PayPal will securely store your customer’s data outside of your server or network. This can also limit your business’s exposure to fraud and reduce your PCI requirements.

PCI Compliance & More

PayPal offers a high level of security. It is a Level 1 PCI-compliant payment processor. It’s also certified by the Visa Cardholder Information Security Program and Mastercard Site Data Protection Program. Service providers certified by these programs must conduct annual on-site PCI security audits and annual network security scans.

PayPal also adheres to the EU’s strict GDPR privacy requirements. Its management capabilities also help you meet global standards for PCI SAQ-A and PSD2.

Additional Security Features

Zettle by PayPal card readers and terminals are EMV approved (Europay, Visa, and MasterCard) for an added layer of security. The equipment also adheres to the highest PCI PTS 4.1 industry standards, ensuring the software is tamper-proof.

Both PayPal and Zettle also offer seller protection policies to guard against losses due to chargebacks, reversals, and related fees. For example, PayPal’s seller protection will step in when a customer contacts PayPal and claims they didn’t authorize a payment or an item they ordered and paid for was not delivered.

Once a buyer submits a claim, PayPal will investigate. You’ll need to provide relevant documents, such as order tracking details and confirmation of delivery, to ensure the dispute is resolved in your favor.

PayPal security and seller protection services.
PayPal offers a variety of security measures and dispute resolution services

While PayPal offers optional chargeback protection for eligible credit and debit card transactions, Unlike seller protection, it’s not free – there’s a 0.40% charge for each transaction covered under the program. In contrast, PaymentCloud offers free tools and assistance to limit chargebacks and resolve disputes.

While no financial platform can claim to be entirely bulletproof, PayPal goes the extra mile. It also runs a Bug Bounty Program in partnership with HackerOne, offering financial payouts to ethical hackers who identify weaknesses in its security systems.


Customer Support

Plenty of Support Options, but Not All Are Helpful

At first glance, the range of support channels – phone, live chat, and messaging – seems rather robust, though to access some options like technical support or messaging, you’ll have to log in to your PayPal business account.

PayPal also has a Business Resource Center with helpful articles on key topics, from the ins and outs of achieving PCI compliance to marketing strategies to promote your company.

To test customer support, I first tried live chat. After interacting with the PayPal chatbot, the system connected me to a support specialist within a few minutes. The biggest problem? The support agent was eager to sign me up for a business plan but never answered basic questions.

PayPal live chat support
I found the live chat support specialist surprisingly unhelpful

Next, I called sales and had a far better experience. Again, I was quickly connected to an agent, but this time I received straightforward answers to my questions. Once the call was over, the agent sent a link and a step-by-step guide to sign up for a business account, but no transcription of the call.

Although helpful, PayPal’s representatives could be less sales focused.


How does PayPal match up to the competition?

Leaders Merchant ServicesCompareOur Score4.8Compare
PAYARCCompareOur Score4.7Compare
PayPalCompareOur Score4.0Compare
QuickBooks PaymentsCompareOur Score3.5Compare


PayPal’s no-fee monthly plans, simple setup, and transparent fees make it a good option for startups and small businesses with low transaction volumes. While PayPal’s website clearly states its per-transaction fees, they are higher than what many competitors charge.

Businesses with higher sales volumes may want to look into a credit card processor like PAYARC that offers a monthly subscription plan, no percentage markup, and a low flat fee per transaction.

I’ve summarized key pros and cons below to help you determine whether PayPal is right for your processing needs. Our review of the 10 best credit card processing companies in 2024 can help you make an informed decision.
Pros Cons
  • Easy approval and setup
  • Multiple payment methods accepted
  • Good e-commerce features
  • Fast payouts to your PayPal account
  • No free POS equipment
  • Higher per-transaction fees than competitors
  • Inconsistent customer support
  • Withheld funds, account freezes, and terminations without warning


Does PayPal charge a fee for a business account?

While PayPal doesn’t charge a monthly fee for payment processing, you’ll have to pay a percentage markup and fee for each transaction. These rates are higher than those of other popular processors. It also charges monthly fees for its Payments Advanced or Payments Pro products, which allow you to customize your checkout experience.

What do you need to open a PayPal business account?

There are virtually no requirements for setting up PayPal as your payment processor – no underwriting, payment processing history, or credit check. You can apply online, get approved, and begin accepting payments the same day.

How fast does PayPal payout for approved transactions?

PayPal deposits funds for processed transactions within minutes to your PayPal business account. If you want to transfer funds to a linked bank account, it will take 1-3 days on average. You can expedite the transfer for a fee.

What are the downsides to using PayPal for payment processing?

The biggest downside is that PayPal’s transaction fees can be high and difficult to navigate. As your business grows and your sales volume increases, you may want to explore other options. Our expert review of the 10 best payment processing companies in 2024 can help you make an informed decision.
Dawn Prevete Dawn Prevete
Dawn specializes in writing about a range of software products, including website builders, backup services, credit card processing solutions, and project management platforms. She has 10+ year’s experience as a technical writer and has written a number of articles for CEOs and senior executives at client companies that have appeared under their bylines. When she’s not researching and testing digital services, she brainstorms with educators to ensure all students have access to enriching learning opportunities.
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