Paypal Goods and Services & Friends and Family Know Everything
As the largest payment processor in the world, PayPal has long provided a feature to send and request money from friends or family members.
Similarly, on top of sending money to friends and family, PayPal also offers a service that is tailored to selling goods and services.
Before we start, let’s clear up what Paypal goods and services are.
Goods are physical items or products bought from another person– e.g. a bike, computer parts, exercise equipment, etc.
Services refer to a service provided by someone– like if someone writes a case study, optimizes a website, or does your taxes for you.
In this article, we’ll cover these use cases and will also show how Wise can be useful for you as an international seller of items or services.
How does PayPal Goods and Services work?
As a buyer When you’re shopping on a website and click the ‘Buy Now’ button or go through a checkout system, then PayPal will automatically process the payment as Goods and Services.
However, before the payment is complete, you can choose to pay the fee or pass it on to the person you’re purchasing from.
To pass it on, change the payment to a Goods and Services payment which will be covered by PayPal Purchase Protection.
As a seller Sellers can use their personal PayPal accounts to accept money for the sale of goods and services.
Upon receiving the money, you can hold the funds in a linked Cash Account or you have the option to transfer the money to a bank account, debit or credit card.
If you use your personal PayPal account to sell goods and services frequently, it might be a good idea to get a PayPal business account instead.
It is possible to convert your personal account into a business account if you want to test things out and make a decision later.
How to use PayPal Goods and Services?
There are two ways of using PayPal’s Goods and Services feature, depending on whether you’d like to use PayPal as a buyer or a seller.
In this section, we’ll show you a step-by-step breakdown of both use cases.
Pay for Goods and Services: Step-by-step Paying for goods and services with PayPal is a simple process.
Here’s how to do it:
1. Open the PayPal site and log in to your personal account.
2. Click the ‘Send and request‘ tab at the top of the page.
3. Click on the button labelled ‘Pay for Goods and Services.
4. Input the recipient’s email address in the box and click ‘Next’.
5. Input the amount of money you want to send to the recipient and add any additional notes in the text box below.
6. Confirm the transaction and follow any additional prompts until you see a notification that the funds were transferred.
Request money with Goods and Services: Step-by-step If you’re the one providing the goods or services, here’s how you can request the funds:
1. Go to the PayPal site and log in to your account.
2. Click the tab at the top labelled ‘Send and Request’.
3. Under ‘Request payments’, click the button that says ‘Request from anyone’.
4. On the next page, type in the email address of the person you’re requesting funds from and click ‘Next’.
5. Input the amount you wish to receive and add any notes in the text area at the bottom of the box.
6. Click ‘Request payment’ and you should see a confirmation.
PayPal Goods and Services fees as an international seller PayPal considers any sale of ‘Goods and Services to be a commercial transaction and charges a fee of 2.89% + a fixed fee and a currency conversion spread based on the currency.
If you’re going to receive money as an international seller then the fees can start to add up quickly– there might be an alternative for you to save on fees What’s the difference between friends and family or goods and services payments? You can send money to friends and family or pay for goods and services in the Send & Request tab at the top of the PayPal page.
If you’re sending a payment, payment types include: Sending to a friend and family – used when sending money or a gift card to a friend or family member.
Before you complete a payment, you can opt to pay the fee, or pass it onto the recipient by changing it to a Goods or Services payment, to be covered by PayPal Purchase Protection.
Paying for goods or services – used when buying an item or service from someone.
When you make a purchase, the seller pays a small fee to receive your money.
Your payment is covered by our protection policy automatically. You can make a personal payment to anyone in the U.S. for free.
Just make sure that you pay the entire amount using your bank account or your balance if you have a PayPal Balance account.
There is a small charge for payments made with a debit or credit card.
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