PayPal account creation is free and takes about five minutes. A basic account lets you send and receive money immediately. Verifying your identity removes all standard limits (sending cap, receiving cap) and unlocks the PayPal Debit Card and Instant Transfer. This guide covers every step from signup through invoicing and cashing out.
See the PayPal overview for limits and fees at a glance.
Step 1: Create Your Account
- Go to paypal.com → click Sign Up
- Choose Personal Account (for shopping and P2P) or Business Account (for selling and invoicing)
- Enter your email address and create a strong password
- Provide your name, address, phone number, and date of birth
- Agree to the User Agreement and Privacy Policy
- Verify your email via the confirmation link PayPal sends
Immediately enable two-factor authentication: Settings (gear icon) → Security → 2-Step Verification → Turn On. This protects your account from unauthorized access even if your password is stolen.
Step 2: Verify Your Identity (Highly Recommended)
Without verification, you are capped at $4,000 lifetime sending and $500/month receiving. Verification removes all standard limits and unlocks Instant Transfer and the PayPal Debit Card.
- After login, PayPal may prompt you via a banner — or go to Settings → Account Limitations → Resolve
- Enter your full legal name, date of birth, and home address (must match government ID)
- Provide your Social Security Number — last 4 digits for most users; full SSN if PayPal requires more verification
- Link a bank account (see Step 3)
- Confirm your phone number via SMS
Verification typically completes within minutes. In some cases PayPal may request a photo of a government-issued ID.
Step 3: Link a Bank Account or Card
Linking a bank account enables free ACH withdrawals and is required for Instant Transfer.
- Go to Wallet → Link a bank or card
- Choose Bank Account → enter routing and account numbers
- PayPal sends two small micro-deposits (1–2 business days) — confirm the exact amounts in your Wallet to complete verification
Alternatively: Use Plaid for instant bank verification (requires sharing your bank login credentials with Plaid).
For a debit or credit card:
- Wallet → Link a bank or card → Card
- Enter card number, expiration, and CVV
Funding priority: PayPal uses your PayPal balance first, then your linked bank account, then your linked card. You can change the default payment method at checkout.
How to Send Money
Personal Payments (Friends & Family or Goods & Services)
- Click Send & Request → Pay
- Enter the recipient’s email address, phone number, or PayPal @username
- Enter the amount
- Select payment type:
- Friends and Family — free (from balance or bank); no buyer/seller protection
- Goods and Services — seller pays 3.49% + $0.49; includes buyer and seller protection
- Add an optional note
- Review and click Send Now
Which to choose: Use Friends & Family only for people you know and trust. Use Goods & Services for any transaction involving a product, service, or stranger — the fee is worth the protection.
Sending from the Mobile App
- Tap Send (bottom menu)
- Search contacts or enter email/phone
- Amount → payment type → Send
How to Request Money
- Send & Request → Request
- Enter the requester’s email or phone
- Enter amount and optional note
- Click Request Now
They receive an email with a secure PayPal payment link. You can send reminders from the Activity tab.
How to Send an Invoice
For freelancers and business sellers:
- Send & Request → Create an Invoice
- Enter client email address
- Add line items (description, quantity, price)
- Set a due date
- Add optional notes or terms
- Click Send
The client receives a professional invoice email with a PayPal payment button. Payments appear in your balance immediately upon receipt. Track outstanding invoices under Send & Request → Invoicing.
Invoice fee: The standard G&S rate applies (3.49% + $0.49) — deducted from what you receive.
How to Receive Money
You do not take any action to receive payments — PayPal deposits funds to your balance automatically when anyone sends to your email or phone. You will receive an email notification.
New seller tip: If you are a new seller, PayPal may place a hold on incoming funds for up to 21 days. To release holds faster:
- Add tracking information to the transaction
- Mark the order as shipped
- The buyer can confirm receipt, which releases the hold immediately
How to Cash Out — Standard vs. Instant Transfer
Standard Transfer (Free, 1–3 business days):
- Wallet → Transfer Money
- Select your linked bank account
- Enter amount → choose Standard → Continue
- Confirm → Transfer Now
Instant Transfer (1.75% fee, min $0.25, max $25, within 30 minutes):
- Same path → choose Instant → review the fee
- Confirm → Transfer Now
Standard transfers initiated on business days before 5 PM ET typically arrive the next business day. See PayPal fees for the instant transfer cost breakdown.
How to Use the PayPal Debit Card
The PayPal Debit Mastercard lets you spend your PayPal balance directly at any Mastercard-accepting merchant — avoiding the cash-out step and the instant transfer fee entirely.
How to get it (requires verified account):
- Wallet → PayPal Debit Card → Apply Now
- Card arrives by mail in 7–10 business days
- Activate via the PayPal app or paypal.com
Limits:
- Daily purchase limit: $3,000
- Daily ATM withdrawal: $400
- In-network ATMs: Free (MoneyPass network)
- Out-of-network ATMs: $2.50 + operator fee
Quick Reference
| Task | Path |
|---|---|
| Send money | Send & Request → Pay → email/phone → amount → payment type |
| Request money | Send & Request → Request |
| Create invoice | Send & Request → Create an Invoice |
| Cash out (free) | Wallet → Transfer Money → Standard |
| Cash out (instant) | Wallet → Transfer Money → Instant |
| Link bank | Wallet → Link a bank or card → Bank Account |
| Verify identity | Settings → Account Limitations → Resolve |
| Enable 2FA | Settings → Security → 2-Step Verification |
| Get debit card | Wallet → PayPal Debit Card → Apply Now |
For security guidance and scam avoidance, see Is PayPal safe?. For the full fee schedule, see PayPal fees.
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