PayPal Accounts for Freelancers – Which is Best for You? When you run your own freelance business, one of the decisions you’ll have to make sooner or later in which PayPal account to open. There are three main types of accounts, and each one comes with its benefits, as well as a few drawbacks.
In this article, we take an in-depth look at what each of the accounts has to offer and which ones might be best suited to your needs. Hopefully, by the end of it, you’ll have made up your mind on which one will work best for you!
PayPal is one of the most well-known payment services on the internet, and they’re used in over 200 countries around the world. Millions of freelancers use PayPal as their payment method, but not all PayPal accounts are created equal. If you’re going to be earning an income from your freelance work, you must choose a PayPal account that will make your life easier – read on to learn more about the different options available to you and which ones are best for freelancers like yourself!
The basic PayPal accounts
The basic PayPal account is the most simple and least expensive way to start accepting credit card payments. If you’re not taking credit cards but you are selling digital goods, the PayPal account without a bank account would be best for you. There are no monthly or per-transaction fees as long as you receive less than USD 1,000 in total volume every quarter.
The business account charges 1% per transaction when receiving credit card payments, has no monthly or annual fees and does not require a bank account. Plus, it comes with more tools and benefits like fraud protection, point of sale software support, marketing insights and analytics.
For freelancers who sell physical goods online, the Premier account could be a good option because it includes everything that’s included in the Business account plus 100 free transactions each month which might come in handy if your company sells seasonal items.
The business accounts
There are three different types of PayPal accounts: personal, business, and premier. Personal and business accounts allow you to accept payments in two ways—one is by sending the funds as a gift or cash from your PayPal balance to the recipient’s email address, while the other is by processing a credit card or debit card transaction through PayPal. Premier account holders also have an option to transfer funds from their bank account into their PayPal account but can only process one type of payment.
The personal account does not charge monthly fees or per-transaction fees and offers a $10,000 maximum funding from external sources. The business account charges $30 monthly and $0.30 per transaction but offers unlimited funding from external sources. The premier account charges $150 monthly with no per-transaction fee; however, there is a 30-cent per-transfer fee for deposits coming from external sources.
Which one should you choose?
There are two different PayPal accounts available to freelancers: Personal and Premier. If you only plan on earning money by doing freelance work, then the Personal account should suffice. However, if you plan on doing retail transactions with your business, then the Premier account might be a better option since it comes with extra protection and benefits not available in the Personal account.
Keep in mind that the Premier account does come at an additional cost, so it’s best to weigh your options before making a decision. For more information about these two types of accounts, visit our What Is a PayPal Account? blog post.
All you need to do to get your account set up is follow these simple steps and you’re ready to start accepting payments. When it comes time to choose a funding source, most freelancers go with the bank account option since PayPal holds money.
Start by logging into your PayPal account and selecting Settings in the top navigation bar. Select the Accounts to tab on the left-hand side of the screen, then choose the Personal Profile subheading under Funding Sources. In this area, select Bank Account as your primary account, and create a secondary account if you plan to accept credit cards or other payment methods as well. Once both accounts are created, make sure they are linked to one another so that funds can transfer back and forth seamlessly.
From there, decide whether or not you want to link any additional bank accounts that offer better exchange rates when converting currencies before deciding which one will be used as your primary funding source!