Selling on eBay with PayPal - dummies

By Marsha Collier

PayPal allows eBay buyers to safely click and pay with a credit card, instant transfer, or e-check directly from eBay (or thousands of other online stores) after they’ve won an auction or made a purchase. PayPal conveniently integrates into all eBay transactions and has a streamlined checkout on other sites. If your auction uses the Buy It Now feature or is a fixed-price listing, you can require buyers to pay for their purchases immediately with PayPal payments.

When you go to for the first time, you will land on the consumer landing page.


Once you’ve signed up for a business account, you will land on the business hub.


To accept credit card payments, you must have a Premier or Business account. Buyers may join when they win their first auction and want to pay with PayPal, or they can go to the PayPal website and sign up. The story is slightly different for the seller. You need to set up your PayPal account before you choose to accept it in your auctions or sales.

Here are more than a few particulars about PayPal accounts:

  • Auction payments are deposited into your PayPal account. Choose one of several ways to get your money:

    • Have the money transferred directly into your registered checking account.

    • Receive payment by check (PayPal charges $1.50 for the check).

    • Keep the money in your PayPal account for making payments to other sellers.

    • Withdraw the cash from an ATM with a PayPal debit card. If you enroll in PayPal Preferred Rewards, you’ll get back 1 percent of the money spent on purchases.

  • PayPal assesses your account $20 for any chargeback. The fee is waived if you’ve fulfilled the requirements in the PayPal Seller Protection policy. To specify whether you want to accept a credit card payment from a buyer without a confirmed address, log on, go to your account, and then click the Profile tab. Next, scroll down Selling Preferences and click Payment Receiving Preferences. If you accept payment from a nonconfirmed address, that transaction will not be covered by the PayPal Seller Protection policy.

  • The PayPal Seller Protection policy protects you for the full amount of the eligible payment, unauthorized card use, and non-shipments. To qualify for this protection, you must do the following:

    • Be a verified member of PayPal with a Premier or Business account: Allow PayPal to confirm with your bank that your checking account and address are your own.

    • Ship only to a confirmed address: PayPal confirms that the buyer’s ship-to address coincides with the address to which the credit company sends monthly bills. Fraudulent shoppers often ask you to ship to another address — don’t do it.

    • Keep proof of shipping that can be tracked online: Here’s where those delivery-confirmation things come in handy. For transactions greater than $250, you must get a signed proof of delivery from the shipper.

    • Ship tangible goods: PayPal doesn’t cover goods that are transmitted electronically.

    • Accept only single payments from a single account: Don’t let a buyer try to pay portions of a purchase from different e-mail addresses. Someone who is trying to pay using several accounts may be attempting to defraud you.

Other requirements change from time to time. Check PayPal’s help area for updates. But know that if a transaction is eligible, Seller Protection Policy Eligible will appear on the individual Transaction Details page.

Seller’s fee tiers for all accounts (including Business and Premier) are adjusted according to the prior month’s transaction volume.

PayPal Domestic (U.S.) Transaction Fees by Sales Tier
Monthly Sales Fee
$0 to $3,000.00 2.9% plus $0.30 USD
$3,000.01 to $10,000.00 2.5% plus $0.30 USD
$10,000.01 to $100,000.00 2.2% plus $0.30 USD
$100,000.01 and over 1.9% plus $0.30 USD