Is Just Using PayPal a Good Idea for an Online Store?


When you set up an online store or business, including PayPal as a payment option is a sound choice. PayPal is a trusted third-party payment method that simplifies transactions between merchants and clients. The company has a considerable market share, projecting to process more than $20 billion of transactions during in 2013. PayPal is an easy choice for online commerce -- the wisdom in making it the only choice is debatable.


  • One of PayPal's biggest selling points is its simplicity for both customers and merchants. All back-end transaction details are handled by PayPal, and depending on the level of integration and service tier, require minimal interface setup when adding the PayPal checkout to the store. PayPal also offers customers a number of payment options in a single interface.

Payment Variety

  • Using PayPal as your store's sole payment transaction method doesn't limit the number of payment methods available. Even the most basic PayPal merchant services feature support for transactions with PayPal accounts, credit cards on both mobile devices and online and the ability to send invoices. Higher-tier merchant services also include the ability to accept credit cards through PayPal via phone, fax and mail. PayPal's Bill Me Later service on the client end offers further versatility, as purchases can be paid in installments rather than all at once -- a possible incentive toward larger or more expensive purchases.

Multiple Currency Support

  • According to Paypal's website, PayPal supports transactions for more than 25 world currencies, as well as exchange services for these currencies. This can be convenient for both merchants and customers, as merchants can accept orders from across the globe without having to exchange payments, and customers can have their funds automatically converted for a small fee as part of the same sales transaction.


  • PayPal security is well regarded and constantly evolving to meet new challenges. In most cases, both merchants and customers can feel secure using PayPal transactions, especially with features such as fraud screening and the Seller and Buyer Protection Policies. During a series of online attacks in November 2012, hacktivist group Anonymous falsely claimed PayPal as one of its victims. While the claim was eventually disproved, the rumor had already circulated, and customers who heard it may be wary of PayPal as the sole payment option.


  • Like most payment methods, PayPal has merchant-side fees associated with transactions. PayPal claims 2.9 percent of the final sale price plus 30 cents for every transaction, with those rates possibly scaling lower based on sales volume. There are also monthly fees to consider based on the merchant service tier you select. The Standard tier has no monthly fee, while the Advanced and Pro tiers cost $5 and $30 per month respectively. When deciding whether or not to offer PayPal as your sole payment method, bear in mind that adding other services requires further fees for monthly services and transactions.

Single Point of Failure

  • While there may be several benefits to using PayPal as your sole payment option, there is one enormous drawback -- it creates a single point of failure for your transactions. Should PayPal come under attack or experience technical difficulties, your business will be without any means of completing any transactions at all. The longer such technical difficulties persist, the more disastrous it can be for your company's income. Having more than one payment method ensures that should the unthinkable happen at PayPal, your customers still have a means to purchase your goods or services.

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