If you are a major ‘online shopper’ there is a high chance that you either have a PayPal account or have heard a lot about it. In case you haven’t this story on Paypal will help you gain some insights about PayPal. Founded by Ken Howery and his friends in California (1998), PayPal (a current US$3billion company), is an American-based global e-commerce business allowing payments and money transfers to be made through the Internet. PayPal is an acquirer, performing payment processing for online vendors, auction sites, and other commercial users, for which it charges a fee. It may also charge a fee for receiving money, proportional to the amount received. The fees depend on the currency used, the payment option used, the country of the sender, the country of the recipient, the amount sent and the recipient’s account type. In addition, eBay purchases made by credit card through PayPal may incur extra fees if the buyer and seller use different currencies.

Where PayPal fits the bill well for consumers is that every time a consumer has a transaction on the internet he does not have to reveal his bank account details, card number etc. With a PayPal login id online payments and receipt is just seconds away and the firm guarantees very high standards of security. Bank account details, Pan card number, various verification checks are held during registration but once the account is operational the transfers are a cake walk. The recipient of a PayPal transfer can either request a check from PayPal, establish their own PayPal deposit account or request a transfer to their bank account.

The current incarnation of PayPal is the result of a March 2000 merger between Confinity and . eBay watched the rise in volume of its online payments and realized the fit of an online payment system with online auctions. eBay purchased Billpoint in May 1999, prior to the existence of PayPal. eBay made Billpoint its official payment system, dubbing it “eBay Payments,” but cut the functionality of Billpoint by narrowing it to only payments made for eBay auctions. For this reason, PayPal was listed in many more auctions than Billpoint. In February 2000, the PayPal service had an average of approximately 200,000 daily auctions while Billpoint (in beta) had only 4,000 auctions. By April 2000, more than 1,000,000 auctions promoted the PayPal service. In October 2002, PayPal was acquired by eBay for $1.5 billion. Currently, PayPal operates in 190 markets, and it manages more than 232 million accounts, more than 100 million of them active. PayPal allows customers to send, receive, and hold funds in 24 currencies worldwide. In 2011, PayPal announced that it would begin moving its business offline so that customers can make payments via PayPal in stores. Complying with RBI regulations for Indian business’s PayPal is not a very lucrative option as owing to the tax problems in India no user can hold money in PayPal accounts and a maximum transfer of US$500 can occur in a day.


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