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Accepting Credit Cards, Some Alternative Methods

By Melisa McCurley
Posted Monday, September 13, 2004

First Alternative

The first alternative we will look at is something called an Email Payments Network. Probably the two most well known are PayPal ( and PayPlace ( These services allow customers to pay you with their credit card, and the funds will be instantly transferred into your PayPal or PayPlace account. You will then receive a notification email with the name of the person who sent you money, the amount, and instructions on how to collect it. You may opt to have the network send you a check, or with PayPal you can have it automatically deposited into your bank account. You can also leave it in your account and use it to make payments yourself.

PayPal is the original, so we'll start with them. PayPal accepts MasterCard and Visa. They offer Personal and Business accounts. Personal accounts are free and have a $500 spending limit. Once you verify your bank account, you may charge up to $2000 in each six month period. Businesses must now use a Business account.

Business account will be charged a 1.9% per transaction fee when receiving money. Sending money is always free.

Business Accounts have no limit on credit card funds received. Buyers who have reached their PayPal $2,000 credit card spending limit can still charge their card when sending a payment Business account.

The Business account offers a lot of extra services, like auto-sweep , a 24/7 customer service call center, Batch Pay, Web Accept, and downloadable transaction logs. Auto-sweep (optional, carries a 0.6% fee) will automatically sweep all your funds into your bank account at the end of each day. Web Accept (optional, 1.9% on payments received) Lets buyers click a button on your website, pay you, and then be returned to your website while your payment is sent directly to your account. Batch Pay (optional, cost 2% or $0.25 per payment, whichever is less) lets you send payment to multiple people at once. This is good for paying employees or for paying your customers if you run your own affiliate
program. They also plan to offer debit cards, interest, and checking accounts in the future.

PayPal is currently available through email, Palm organizers and Internet-enabled mobile phones in the U.S. The PayPal platform will soon be extended to other wireless devices, such as Web-enabled pagers.

PayPlace is very similar to PayPal's personal account. PayPlace accepts MasterCard and Visa as well as American Express. Sending and receiving money is free. The maximum you can charge on PayPlace with your credit card in a 30-day period is $500. PayPlace is only available through email.

To use either service, customers must also have an account. Signing up is quick and easy, and PayPal is currently offering a $5 incentive for signing up and $5 for each person you refer whom signs up and verifies their bank account. PayPlace is no longer offering sign-up incentives, but both companies say they will have ongoing bonuses for members in the future. PayPal and PayPlace are currently only available to US residents, but PayPal plans to expand to international users soon.

Both services are easy to use and you can have accounts with both at the same time. They offer an easy, inexpensive alternative to merchant accounts, but be wary of copycat services. Some are not legitimate.

About the Author
Melisa McCurley is the owner of Virtually Designed Affordable website design for small and home businesses - ( And editor of Biz Bytes - free ezine designed to help you start, run, and prosper at your small business -


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