Business vs. Personal PayPal Accounts for Your Shopify Store—Which One's Right for You?

Paypal is one of the best payment gateways for online transactions as it has always been an easy and secure method for international payments. You can create a personal as well as a business account depending on your needs, and the best part is that both accounts are free from any kind of registration or maintenance fees. You can even upgrade from a personal account to a business one in just a few easy steps.

We'll compare the PayPal Personal and Business accounts, examine their features, check their pros and cons, and help you decide which one is best for your Shopify store.

» For PayPal alternatives, check out this list of the best buy now pay later apps

PayPal Business Accounts

As its name says, PayPal business Accounts are used for businesses to send and receive payments. They're specifically designed for businesses and offer a number of features that can help streamline your online sales. One major benefit of a PayPal business account is that it allows you to accept credit and debit cards in addition to PayPal payments. This can help increase sales as some customers may prefer to use their credit or debit card instead of PayPal.

In addition, a PayPal business account allows you to access more detailed sales reports and integrate PayPal express checkout with Shopify. Most functions and tools provided by PayPal for business owners are only available when using a business account. You can track your sales and make better business decisions. As they're geared towards businesses and professional usage, PayPal business accounts offer more advanced fraud protection and a higher level of customer service.

PayPal Personal Accounts

On the other hand, Personal PayPal accounts are meant for personal use. They're more suited for individuals rather than businesses and, as such, offer fewer features and less flexibility compared to business accounts. For example, with a PayPal personal account, you can't accept credit or debit card payments. Additionally, personal accounts have lower monthly processing limits, making them unsuitable for larger businesses.

However, personal accounts have significantly lower transaction fees and allow for more flexibility when it comes to using your money.

Can I Use a Personal PayPal Account for Shopify?

The short answer is yes.

The slightly longer answer is that maybe you shouldn't.

The official Shopify policy is that you need a business account to use PayPal as a checkout option on your store. However, some people have reported managing to register their personal accounts despite this restriction. Still, we don't advise this approach as you'd be in violation of Shopify's terms of service, and you'd risk losing access to the Shopify platform with your account.

Although you can use a personal PayPal account for business, it's more suitable for receiving or sending money to family and friends. It is also ideal for online shopping and payment for shared expenses. You can opt for this one if your business doesn't sell a lot of products or if you're going for one-time transactions. Additionally, keep in mind that your customers will only be able to make purchases via PayPal, as personal PayPal accounts don't accept credit or debit card payments.

Comparing a Business PayPal Account to a Personal PayPal Account

Here, we'll cover fees, features, and transaction limits of personal and professional PayPal accounts.

Paypal Business Vs. Personal Fees

The main difference here is that PayPal business accounts are subject to higher transaction fees. These fees vary based on the type of transaction and the country. In addition, if you sell things and receive payments through your PayPal account, both a business one and a personal one will charge you a fee (check the table below).

Every international payment comes with a 1.5% surcharge, and there are special fees for crypto trading, donations, etc., for both types of accounts.

Here's the overview of the most common fees for both personal and business PayPal accounts:

*the fee depends on the currency

Additional Features Offered by a PayPal Business Account

The best part about the PayPal business account is that it covers all the features of a Paypal personal account, yet also gives you the following options to make your transactions easier and more secure:

• Allows you to print the labels and track payments
• Offers live customer support
• Protects your privacy by allowing you to register under your company name instead of your own name
• Gives customers the option to pay via debit or credit card, whether they have a PayPal account or not

If you are running a successful online business or working as a freelancer offering your services around the world, then a PayPal business account is perfect for you.

How to Upgrade to PayPal Business Account

If you've been using a personal PayPal account and want to switch to a business one, you can do so very easily. Just follow the steps outlined below.

• Go to My PayPal Account Settings (the gear icon in the top right)
• Click on the "Upgrade to a Business account" link at the bottom of the left-side panel.
• Pick a business type: Individual/Sole Proprietorship, Sole Proprietor, Partnership, Corporation, Private Corporation, Public Corporation, Nonprofit, or Government entity. If you pick anything other than Individual/Sole Proprietorship or Sole Proprietor, you will have to create a new business account; you won't be able to upgrade.
• Select "Upgrade your account" if prompted.



• Fill out the required form, and you're done.

KeepShoppers Takeaway

With a Shopify store or any kind of business, you really can't go wrong with a PayPal Business Account. While a personal one might do the trick, you'll probably want the extra features and legal protections afforded by a business one. It allows you to accept payments from customers as a business, gives you certain tax benefits, and doesn't restrict the payment method to PayPal transfers only.

If you'd like to keep the flexibility of a personal PayPal account and still run a business, you can always create a new business account that you'll use for your business. That way, you'll get the best of both worlds.