What you need to open a PayPal account
You can open a PayPal account in about ten minutes with an email address, a password, and either a debit card or bank account number. PayPal does not charge you to create the account itself. You will need to verify your identity before you can send money or receive payments above small amounts, which means having a valid government ID and a Social Security number or tax ID on file.
PayPal offers two account types: Personal and Business. A Personal account is what most people use for peer-to-peer transfers and online shopping. A Business account costs nothing extra but is designed for people who sell goods or services and need invoicing tools and transaction reports. You can switch between them later, so start with whichever matches what you plan to do first.
The account itself is free. You only pay fees when you send money internationally, receive money as a business payment, or use certain features like PayPal Credit. Sending money to friends and family in the United States through PayPal's standard transfer method has no fee.
Key Takeaways
- You need an email address, a password, and either a debit card or bank account to create a PayPal account, which takes about ten minutes.
- PayPal will ask you to verify your identity with a government ID and Social Security number before you can send or receive large amounts of money.
- Personal accounts are free and designed for peer-to-peer transfers; Business accounts are also free but include tools for selling and invoicing.
- You can link multiple payment methods to your account, and PayPal will let you choose which one to use for each transaction.
Step-by-step account creation
Go to paypal.com and click the "Sign Up" button at the top of the page. You will see two options: Personal Account and Business Account. Select the one that matches your needs, then enter your email address and create a password. PayPal will send a confirmation email to that address—click the link inside it to verify you own the email.
Next, enter your full name, date of birth, and address. PayPal uses this information to verify your identity later. Then add a payment method: either a debit card (you will need the card number, expiration date, and CVV) or a bank account (you will need your routing number and account number, which you can find on a check or in your bank's app).
After you submit this information, PayPal will confirm your account is created. You can start using it to receive money or make purchases right away. However, you will not be able to send money or withdraw funds until you complete identity verification, which happens in the next step.
Verifying your identity
PayPal requires identity verification before you can send money or receive payments above a certain threshold. The process is usually automatic: PayPal checks your information against public records and tells you within minutes whether you are verified. If the automatic check passes, you are done.
If automatic verification does not work, PayPal will ask you to upload a photo of your government ID—a driver's license, passport, or state ID card. Take a clear photo of both the front and back, and upload it through your account settings. PayPal reviews these photos and usually responds within one business day.
In rare cases, PayPal may ask you to confirm a small deposit they make to your linked bank account. They will deposit two small amounts (usually under one dollar each) and ask you to tell them the exact amounts. This confirms you have access to the bank account you listed. Once you confirm, your account is fully verified.
Linking additional payment methods
You can add multiple debit cards, credit cards, and bank accounts to your PayPal account. Each one appears in your wallet, and you choose which one to use when you send money or make a purchase. To add a new payment method, go to your account settings, select "Wallet," and click "Link a card" or "Link a bank account."
For debit and credit cards, you enter the card number, expiration date, and CVV. PayPal may make two small charges to the card and ask you to confirm the amounts, which verifies you own it. For bank accounts, you provide your routing and account numbers, and PayPal verifies the account the same way—with two small deposits you confirm.
You can set one payment method as your default, which PayPal will use automatically unless you choose a different one. You can also remove any payment method at any time by going to your wallet and selecting "Remove."
Understanding PayPal's fee structure
Sending money to friends and family in the United States costs nothing if you use your bank account or debit card and choose the standard transfer option. If you send money as a business payment (for goods or services), PayPal charges a fee: 2.2% of the amount plus $0.30 per transaction. If you send money internationally, the fee depends on the destination country and the payment method.
Receiving money works the same way. If someone sends you money as a friend or family transfer, there is no fee. If they send it as a business payment, PayPal takes a cut. Credit card payments carry higher fees than bank transfers because credit card companies charge PayPal a processing fee, which PayPal passes along.
PayPal also offers PayPal Credit, a line of credit you can use to make purchases. Using PayPal Credit is optional, and you only pay interest if you do not pay back the full balance within the promotional period (usually six months for purchases over $99).
Sending and receiving money
To send money, log into your account and click "Send Money" or "Transfer Funds." Enter the recipient's email address or phone number, the amount, and whether it is a friend or family transfer (free) or a business payment (fees explore). PayPal will show you the fee before you confirm, so you know exactly what you are paying. The recipient gets a notification and can accept the money into their PayPal account or transfer it to their bank account.
To receive money, you give someone your PayPal email address or phone number. They log into their account, click "Send Money," and enter your information and the amount. The money appears in your PayPal balance when ready. You can leave it there to use for future purchases, or you can transfer it to your linked bank account, which usually takes one to three business days.
If you are selling something or offering a service, you can also send an invoice. Click "Tools" in your account menu and select "Create an invoice." Fill in the amount, description, and the buyer's email address. PayPal sends them a professional invoice they can pay directly, and the money goes into your account.
Keeping your account find
Use a strong password—at least 12 characters, with uppercase and lowercase letters, numbers, and symbols. Do not use the same password on other websites. PayPal will never ask you for your password in an email or text message, so if you receive a message claiming to be from PayPal and asking for your password, it is a scam.
Turn on two-factor authentication in your security settings. This means PayPal will send you a code via text or email every time you log in from a new device, and you have to enter that code to access your account. It takes an extra ten seconds but makes it much harder for someone else to break in.
Check your transaction history regularly. Log into your account and review recent activity to make sure every transaction is one you made. If you see something you did not do, report it to PayPal when ready through the Resolution Center. PayPal has a buyer and seller protection policy that covers unauthorized transactions and items that do not arrive.
Frequently Asked Questions
Do I need a credit card to open a PayPal account?
No. A debit card or bank account is sufficient. If you have neither, you can still create an account, but you will not be able to send money until you add a payment method. Some people use PayPal only to receive money, which does not require a linked card or bank account.
How long does it take to verify my identity?
Automatic verification usually takes a few minutes. If PayPal needs to review your ID photo, it typically responds within one business day. In rare cases, verification can take longer if PayPal needs additional information, but this is uncommon.
Can I use PayPal without a Social Security number?
You can create an account without one, but you will not be able to send money or receive payments above small amounts until you provide it. If you do not have a Social Security number, you can use an Individual Taxpayer Identification Number (ITIN) instead.
What happens if I forget my PayPal password?
Click "Forgot password?" on the PayPal login page. PayPal will send you a link to reset it via email. Click the link, enter a new password, and you can log back in. If you do not have access to the email address on your account, contact PayPal support through the Help Center.
Can I close my PayPal account?
Yes. Go to your account settings, select "Close your account," and follow the prompts. PayPal will ask you to confirm and may ask why you are leaving. Make sure you have withdrawn any remaining balance first, because you cannot access it after the account is closed.