Difference Between Personal and Business Paypal: Which Paypal Account is Best for You?

PayPal is the largest online payment system, with over 320 million users, offers the best solution for online transactions. If you’re new to PayPal and planning to get started with an account, the first thing you’ll see is a choice between two types of accounts.

A personal account or a business account. After you explore a bit, you’ll find out that both the accounts offer almost the same features initially. You can send, receive, or request payments, pay online, sell items, do any kind of online transactions, etc. 

So, what makes the difference between personal and business PayPal account, and how does it matter? Although a personal account might be the way you want to go, you must know the differences between them. Stick to the article to know the differences between the personal and the business accounts on PayPal. 

Difference between personal and business PayPal: Key differences?

Doing transactions, paying for items, sending money to someone, they are all available in both personal and business accounts. Here is the difference between personal and business PayPal accounts that can help you choose which one you’re going for: 


About Types of PayPal account

Personal account

The name suggests its action. A PayPal personal account is the one you need to shop online, send, receive, or request personal payments. If you’re splitting a dinner bill with your friends, you don’t need the business account to do that. The personal account will get you by even with some casual sellings other than just buying online as well. 

Business account

The case is the same; the name suggests its functionality. A PayPal business account is for maintaining a full-fledged business. It’s the account type for merchants who sell online with a company/brand name and have a business set with employees. You can let up to 200 employees log into the account, manage the inventory, track the orders, maintain revenues, and get customer support through the account.

Pros and cons

Personal account

Using a PayPal personal account can help you with all kinds of personal transactions and occasional sellings smoothly. You can open it up with only an email address, a card, and start transactions with very little chargers and sometimes no charges at all. However, if you’re planning on doing business and receiving regular payments, it’s not the type of account you want. 

Business account

A business account helps you run an SMB farm to a massive business smoothly without any hiccup. It’s the best payment option for you because almost anybody who pays online has a PayPal account to pay you. It becomes much easier to receive payments, get seller’s protection, make invoices, do refunds, track shipment and profit margins, and many more. However, if you sell services or goods occasionally, opening and maintaining a business account would be too much to care for. 

Account fees

Personal account

If you’re in the US and buying something with PayPal’s personal account, it’s always free of charge until the payment is domestic. However, if it’s an international transaction and you’re paying with your PayPal balance, you’ll pay a 5% fee of the amount you’re paying up to $4.99. If you’re funding the transaction with a card (credit/debit/PayPal credit), it will charge you 2.9% of the funded amount, plus a fixed fee depending on the country you’re from.

Business account

You’ll pay 2.9% of the sale with a business account, plus a $0.30 for every transaction you make with your customer. With eligible charities, it will be discounted to 2.2%, plus the regular USD 0.30 transaction fee. If you’re making international sales, the transaction fee will be 4.4% of the price, and a fixed amount depending on which country you’re selling to. When you use a PayPal Here card reader, it will charge you a 2.7% fee while swiping each card, or 3.5%+ $0.15 charge if you manually enter the transaction. 

limitation of receiving and sending money

Personal account

With a verified PayPal personal account, you can send up to $60,000 USD, but a single $10,000 USD transaction. If you’re receiving money, there are no limitations as long as the transaction is legal, and your account is verified. 

Business account

Using a business account doesn’t have any limitations on receiving any payment or paying for anything. If you’re sending money as a personal transaction, the limitations are the same as a personal account; it’s $10,000 per transaction and $60,000 in total. 

Accept credit or debit cards

Personal account

With that information, PayPal will ask you for your credit or debit card number and information as an option. If you don’t use it while opening the account, you must give your credit or debit card information while verifying your account. 

Business account

You have to provide the generic information on the signup page while opening a business account. On the signup page, you have to provide your business’s bank information along with all the other information. 

Which PayPal Account is Best for You?

Now for the truth, which type of PayPal account should you go for? Which account can serve you the best for the purpose you have? Well, the answer depends on the purpose of opening the account in the first place. 

If you’re planning on doing casual selling from time to time and don’t have a business to maintain, there is no point in creating a business account. A personal account will get you all the features you need for regular transactions like paying, receiving, sending, or requesting money. 

If you have a business to run online, and planning on receiving payments from your customers, get a business account. It will allow you to maintain your inventory, make official email, create custom invoices with your company’s logo, and let your employees (up to 200) manage it as an office. The PayPal commissions are less with a business account, and you can keep your name hidden from the customers with the brand name. 

Final thought

Opening a PayPal account can be an easy job if you know which type of account you’re looking for. While you’re opening the PayPal account, you will provide your name, email, phone, and other generic information. With a personal account, the information is not as extensive as a business account needs. A business account requires all the information about your business, banking information, routing number, ownership, and other legal papers.

The business account has a higher withdrawal limitation, that’s where the biggest difference between personal and business PayPal comes in. It has a maximum withdrawal amount of $500,000 a month, while a personal account has a limitation of $15,000 with cards or $25,000 with a bank account.