PayPal is an e-commerce business allowing payments and money transfers to be made through the Internet. PayPal serves as an electronic alternative to traditional paper methods such as checks and money orders.
A PayPal account can be funded with an electronic debit from a bank account or by a credit card. The recipient of a PayPal transfer can either request a check from PayPal, establish their own PayPal deposit account or request a transfer to their bank account. PayPal is an example of a payment intermediary service that facilitates worldwide e-commerce.
PayPal performs payment processing for online vendors, auction sites, and other commercial users, for which it charges a fee. Sometimes it also charges a transaction fee for receiving money (a percentage of the amount sent plus an additional fixed amount). The fees charged depend on the currency used, the payment option used, the country of the sender, the country of the recipient, the amount sent and the recipient's account type. In addition, eBay purchases made by credit card through PayPal may incur a foreign transaction fee if the seller is located in another country, as credit card issuers are automatically informed of the seller's country of origin.
On October 3, 2002, PayPal became a wholly owned subsidiary of eBay, its corporate headquarters are in San Jose, California, United States at eBay's North First Street satellite office campus. The company also has significant operations in Omaha, Nebraska; Scottsdale, Arizona; and Austin, Texas in the U. S., Chennai, Dublin, Berlin and Tel-Aviv. As of July 2007, across Europe, PayPal also operates as a Luxembourg-based bank.
On March 17, 2010, PayPal entered into an agreement with China UnionPay (CUP), China's bankcard association, to allow Chinese consumers to use PayPal to shop online. PayPal is planning to expand its workforce in Asia to 2,000 by the end of the year 2010.
The PayPal Buyer Protection Policy states that the customer may file a buyer complaint within 45 days if he did not receive an item or if the item they purchased was significantly not as described. If the buyer used a credit card, he might get a refund via chargeback from his credit-card company.
According to PayPal, it protects sellers in a limited fashion via the Seller Protection Policy. In general the Seller Protection Policy is intended to protect the seller from certain kinds of chargebacks or complaints if seller meets certain conditions including proof of delivery to the buyer. PayPal states the Seller Protection Policy is designed to protect sellers against claims by buyers of unauthorized payments and against claims of non-receipt of any merchandise.