Do I need a PayPal business account to sell on eBay?

If you’re looking to make some quick cash selling your stuff because, well, you have too much stuff and not enough cash, you’ll find that it’s remarkably quick and easy to start hawking your items on eBay.

It’s equally fast and simple to get paid for the items you’ve listed if you have a PayPal account that you can link to your eBay account. That’s because for more than a decade eBay and PayPal were one business until they split into separate companies in 2015.

The separation of the two companies means sellers on eBay, strictly speaking, aren’t required to have a PayPal account to complete transactions. Practically speaking, it’s a different matter. Because of the long and close association of the two companies, it’s much more complicated and time-consuming to use any of the alternatives to PayPal when processing payments on eBay.

Using a PayPal account to sell on eBay

Though eBay and PayPal are no longer part of the same company, they remain closely integrated. Using PayPal to manage transactions is generally the best option for eBay sellers, including both one-off vendors and serious merchants who are in it for the long haul. PayPal is the method eBay promotes as “safe and efficient” for processing online transactions.

eBay has made it easy to link an existing PayPal account, either personal or business, to their platform. If you have an existing account, eBay will simply ask for your PayPal credentials and will verify your account via email.

If you don’t have a PayPal account, eBay has a streamlined process for getting one when you create your first listing as a seller. eBay will direct you to the appropriate channels so that you can set up your own PayPal account.

Should I have a PayPal business account to sell on eBay?

You can absolutely get away with a PayPal personal account if you’re a casual eBay seller. A “casual seller” is akin to a person having a garage sale. But if you do it on eBay with a personal PayPal account, buyers can pay you via their own PayPal account or even via credit or debit card.

On the flip side, if you have a registered business or even just plan to grow a sustained side hustle on eBay sales, the smart move is to open a PayPal business account.

The standard version of a business account, like the personal account, is completely free to set up, with no account opening costs or monthly maintenance costs. In both cases, PayPal charges a percentage-based transaction fee only when you start doing business. You can accept payments via PayPal, credit cards, and debit cards.

There are big perks to having a business account. A PayPal business account simplifies matters during tax time, while offering an impressive suite of features to help you scale your business. If you’re selling a few odds and ends that you found in your grandmother’s closet on eBay, a personal account is fine, but if you’re building an eBay business, you should open a PayPal business account.

Using managed payments to sell on eBay

If you want an alternative to PayPal for processing payments, consider joining the managed payments on eBay program. This is a relatively new eBay service that allows sellers to receive payments directly into their bank account instead of transferring funds from a PayPal account to a bank account. This option allows sellers to accept more forms of payment from buyers, including Apple Pay and Google Pay.

The catch is that eBay is slowly rolling out this feature. At the moment, in order to take advantage of the managed payments option, you’ll need to register via the eBay site, have a bank account, and provide some information to prove that you comply with basic anti-money laundering obligations.

Even then, though, eBay may not deem you eligible for the program as only sellers with businesses that can support the currently available features will be approved. In the meantime, if you’re not approved, you can quickly and easily get back to business by creating and linking up a free PayPal account.

This article is originally published on Feb 24, 2020, and updated on Mar 27, 2020
Finance expert. Interested in economics, payment & specialized in online payment methods. Guilty of liking too many puppy photos on Instagram.

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