PayPal is a service that allows people to send money and make payments without sharing financial information. The service allows the flexibility to pay with your bank account, credit card or PayPal account balance. Many customers use PayPal to pay for goods and services they purchase. However, small businesses can use PayPal to augment their services.
Billing & Invoicing
When invoicing your customers, you can use PayPal to create custom templates that reflect your brand. Those invoices then get sent out via email to customers allowing you to invoice anyone with an email address. Your customers can then choose to make payment through credit card, debit card or their PayPal account. If you sell goods online, you can incorporate PayPal billing into a shopping cart feature on your website as well.
PayPal Fees
It’s important to note that PayPal does charge fees typically apply only to the seller or service provider. PayPal merchant fees typically start at 2.9% of the total transaction fee plus 30 cents. For this rate you can accept credit card payments, PayPal payments and email invoices directly to customers. You can upgrade your account to PayPal Payments Advanced or PayPal Payments Pro to include additional features.
Financial Reporting
PayPal offers a variety of financial reports that you can export in several formats. This makes it easier to keep track of your income and expenses since you do not manually need to copy this information into another format. However, this is by no means a financial reporting tool. Rather PayPal provides a list of activities – including when an invoice is sent and when payment is received. To do any year-end profit calculations or tax reporting, the data needs to be manipulated.
PayPal revolutionized the small business landscape when it was founded in 2000 by allowing a reasonably priced, flexible online payment option. They continue to stay at the forefront with few real competitors in the marketplace. Look forward to a mobile credit card application, called PayPal Here, to be released from them soon.
Do you use an online invoicing solution? If so, what do you use?
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