The Business Model of PayPal
PayPal established an online fee-based payment service that can be used to transfer funds, e.g. to purchase or sell goods and services, to make or receive donations, as well as to send or receive payments for auctions at eBay or other e-commerce websites. Money can be transferred to anyone with just an email address, however the recipient needs to hold a PayPal account to receive the money. For sales in the U.S., sellers pay mostly 2.9% per transaction and even less if they sell more or if nonprofits are involved. International sales cost 3.9% transaction fee plus a fixed fee based on the currency received. Sending money is free in the U.S. when the funds are transferred from the bank account or PayPal balance.