Paypal Personal Or Business? Complete Guide For Freelancers

Determining which Paypal service to use could be confusing, but once set up could benefit from its many features

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If you work as a freelancer, it is very likely that you need some means of digital payment so that your clients from anywhere in the world can pay you. 

Paypal is used by approximately 300 million people in the world, so it is a popular platform that you must have. However, many freelancers are hesitant about using PayPal personal or business. 

Each option has different advantages and disadvantages that are more or less important depending on your needs, but here you will know each option and what it contributes.

Paypal Personal vs Business


The first thing you should know is that with any type of account you choose, you can still send or receive payments from any country in the world. Registering in PayPal is not difficult at all and completely free, you just have to access the web and follow the steps indicated there.



It is the type of account that PayPal recommends you to “buy on foreign websites”, although this does not invalidate it to carry out all kinds of actions. The reality indicates that, if the account is for private use, and not for business or commercial use, this is the profile for you (you will appear with your name and surname).

The account helps you to receive all kinds of transfers, in addition to paying for your favorite products on eBay, Wish, or other important online stores abroad. 

You can also use it for commercial purposes, although perhaps more sporadically. 

If you are a freelancer who does not belong to a work team, agency, or company and you do not plan to create one, you can use this type of account and in case you are interested in starting a freelance career, you must learn how to become a freelancer online.

Actions you can take:

  • Pay
  • Transfer funds
  • Send payment requests
  • Create payment formats
  • Save money
  • Exchange currencies

This type of account does not ask for any requirements, you just have to enter the page and create your profile. 

Once you have done it, you can link your account to the freelance platforms where you use to advertise freelance services or share it with your clients so that they can use it for payments.



If you are going to “sell and receive payments online around the world”, PayPal recommends this account for you. 

The message is basically the following: if you have a business or are part of an organization, and you will receive payments on a recurring basis, this account will be the way to expand the borders of your business. 

If you use your business account as a seller, the platform will charge you a commission percentage depending on whether it is an international transaction and the country of destination. 

This commission can vary between 3.5% and 4%.

Although in general the operation does not change much, there are some additional characteristics: the possibility of improving your rate according to your potential billing level, in addition to receiving personalized attention for you and your company. 

Also with this account, you will be able to carry out the same actions as the personal account.

The requirement for this account is that you must register all the data of your organization in PayPal. 

That means that you will have to:

  • Have a registered company.


  • Have a bank account in the name of your company.

 If this is something that fits your freelance situation, it is recommended that you take the opportunity of using this option as it can benefit your business. Otherwise, you can use the personal mode that will work just as well for you.

Some of the benefits you will have for opening a business account:

  • Process payments delegating all the logistics in a secure platform.


  • Account with the name of your company for greater confidence for your customers.


  • Easy access to advanced income and loss statistics.


  • Multiple independent users to manage the account.


  • Simple and automatic invoice creation.

In short, if you are a freelancer who does not have a consolidated company, it is best to use the personal option. 

If you represent a company, have a business, work together with other people, or plan to make a brand of a name, use the business option. 

Anyway, if in the course of your professional career you want to become a company, you can upgrade it to Business at any time. The option appears within your PayPal profile, just below your personal information, to start registering your company.

Reasons To Use PayPal


1. You Can Use It To Pay Your Taxes


PayPal gives you the facility that you can pay your taxes with the balance of your virtual wallet. 

You can use to make your payments and you can also receive the tax refund in your PayPal account.


2. It’s Safe


PayPal acts as an intermediary between the buyer and the seller, who can be an individual or a professional, like other services and companies, and it does so by adding guarantees and coverage to the transaction. 

When you have to make a payment on a website, you leave the seller’s website to go to the PayPal page. There you will have to log in with your password, pay, and return to the seller’s store, which never accesses your password or payment information.

PayPal does not send the bank details to the seller, nor do they appear in the transaction. Another positive point is that PayPal returns the full amount and shipping costs in case there are problems that warrant it.


3. It’s Practical To Use


Every time you make a payment through PayPal it will be done immediately, so this provides convenience and security. In other payment platforms, transactions require confirmation processes that may take time to happen. 

It is available for different mobile phone operating systems, and through the app, you can perform all the available actions.

4. There Are No Fees For Transactions Within The U.S.


First of all, there is no cost to create a PayPal account. If you live in the United States and you must carry out a transaction for someone who is within the same country, you will not have to pay a commission and that person will not suffer any loss in the balance received. 

If the transaction occurs with international users, the rate may vary depending on the country, but to make the calculations you can use an online Paypal calculator.

Alternative Services


Trying to find a suitable online payment service can be difficult. PayPal seems like the most obvious and world-renowned option, but there are also other options worth considering. 

Fortunately for those looking for viable alternatives, the market for payment platforms has become a much more competitive space. Now there are several substitutes that offer good rates and cool features that may be better for you or your business.

1. Google Wallet


It is no surprise that the business giant Google has also entered the field of payment platforms. Google Wallet follows other Google products in terms of design and functionality. 

With its payment platform, you will have a free method to accept payments from your customers without having to assume any cost.

Why should you choose Google Wallet?

  • A long checkout process can cause customers to leave your page or the platform. With Google Wallet, only a number or an email address is required.

  • There is an inherent trust in the Google brand that makes it a reliable choice for consumers.

  • The transfer is processed automatically, creating a seamless transition without the need for any subsequent administration by either party.

2. Braintree


While it is true that Braintree is a subsidiary of PayPal, it can still be considered an alternative. 

Some may reject it due to its close association (or also feel more trust), but it is an increasingly successful payment platform that is used more and more.

Why should you choose Braintree?

  • Braintree offers a competitive rate of 1.9% plus approximately $ 0.30 for the transaction with no monthly costs.

  • Due to the support of PayPal, Braintree offers a comprehensive support network to its customers to guide them through the payment process efficiently.

  • They cover more than 130 currencies and 44 countries, which makes them truly international.

  • They also have a high level of third-party integration that makes them a highly compliant payment gateway.

3. Stripe


Stripe is arguably PayPal’s biggest competitor in terms of market share and volume. 

It has a powerful integration, it works seamlessly with hundreds of third-party applications and services which makes it incredibly easy to use.

Why should you choose Stripe?

  • Payments are processed quickly, which is crucial for any business. The money can be in your account in 48 hours.

  • Stripe has a global presence, which means that international payments are not a problem and there is no additional cost.

  • Allows integration and custom development.

  • There is no monthly fee, just a fixed rate of 1.4% per transaction and an additional $ 0.25 for European cards and $ 2.9 and $ 0.25 for non-European cards.

  • Stripe can accept a wide variety of payment methods.

4. Payoneer


Payoneer is the fastest payment system. It is a great option because it works in a similar way to how a bank account would since they can even give you a prepaid card. 

It is also a means of payment that you will find on most freelance platforms.

Why should you choose Payoneer?

  • They offer you a virtual account, which gives them a competitive advantage in the international market.

  • It is easy to process payments internationally, then seamlessly fund a local account.

  • Payments are easy to receive, but also easy to make, creating an efficient two-way payment gateway.

  • Receiving payments from national and international accounts is free unless the payment process is done through a credit card. In that case, you would have a 3% rate.

Choose The Option That Best Suits You


PayPal is a very complete platform that offers different possibilities for freelancers since you can not only use it to make transactions and to receive payments but to save and pay your taxes. 

Between the person option and the business option, there are different characteristics that will benefit you in case you have a business or if you work in a private way. 

If you choose the option that suits your work situation, you will have excellent benefits that will protect your finances.

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