Complete Guide to PayPal Business Account Set Up in the UK

PayPal® is a widely used online payment platform for businesses in the UK and worldwide. Once you’ve set up a PayPal Busines¹ account in the UK you can receive payments in person, online, by phone, and using alternative options like social media and emails. You can also use PayPal to manage risk, to send money, and in some cases, to access working capital.

Ready to set up a PayPal Business account? This guide covers all you need to know about how to set up a PayPal Business account, plus we’ll introduce an alternative you might consider - Wise Business. With Wise you can hold and exchange 40+ currencies, and get paid from 30+ countries, with low fees and the mid-market exchange rate².

Learn more about Wise Business
multi-currency account 🌎

Paypal business account overview

Before we get into the details of the PayPal Business account set up options for the UK, let’s look at what you can do with a PayPal Business account. PayPal splits out its services based on your needs - there are small to medium business solutions for companies with 25 million GBP/year or less annual turnover, and enterprise options for larger businesses. There are also specific solutions for platforms and marketplaces, and for developers.

Broadly, the PayPal Business account lets you³:

• Accept payments - online, in person, via QR code, by phone, social and email. You can even set up recurring payments, in case you sell products or services under subscription.
• Tap into new markets - by accepting transactions in a range of 24 supported currencies for UK customers⁴
• Send payments - in a selection of currencies, including batch payments
• Make payments - with a PayPal Business Debit Mastercard, or by making online and in app purchases
• Manage risk - with fraud prevention tools and PayPal seller protections
• Grow your business - with PayPal working capital

As a leader in digital payments, PayPal has lots of options for helping business owners to get paid and make payments themselves. However, it’s helpful to know that there are fees for some PayPal Business services, which can be quite different to the costs of operating a PayPal personal account. We’ll touch on a few important PayPal fees later - but it’s well worth familiarising yourself with the full PayPal merchant fee schedule for the UK before you open a PayPal Business account.

Read more: PayPal business fees in the UK

Can I have a PayPal personal account and a PayPal Business account?

PayPal Business accounts have different features and fees compared to personal PayPal accounts, and are aimed at small, medium and enterprise level business owners in the UK.

Wondering if you can have more than one PayPal account? If you’ve already got a PayPal personal account you’ll be able to open a PayPal Business account too, to keep your personal and business transactions separate. PayPal personal accounts can be used to send and receive payments, shop online, and to get paid occasionally for online selling.

If you sell online every now and again as a hobby or side hustle, PayPal personal might be all you need. If you’re running a business registered in the UK, however, you’ll need a PayPal Business account to get the features and functionality required.

How to set up a Paypal Business account?

Ready to get started? Opening a PayPal Business account in the UK isn’t tricky and can be done entirely online or using your smart device. You’ll need to have a few important pieces of information to hand when you start your account set up, though - we’ll cover that in more detail in just a moment, so you’re ready to run through the process.

Here’s how to open a business account with PayPal UK via their website⁵:

1. Open the PayPal.com desktop site and click Sign Up.
2. Confirm you want to open a business account and click Continue
3. Enter your email address and click Continue
4. Follow the prompts to add your personal and business information (more on what’s needed next)
5. Read the Privacy Policy and User Agreement, then click Agree and Create Account
6. Enter a few more details about your business from the drop-down menus, and add your business URL, click Continue
7. Add the required personal information
8. You’ll be sent an email to confirm your account details - follow the prompts to complete setting up your PayPal Business account

Once your PayPal Business account is set up you’ll need to add and verify a bank account to complete the verification process. We’ll run through how that works in a moment.

What do you need to set up a Business Paypal account?

To complete the PayPal Business account set up process you’ll need to have certain personal and business information to hand - and then you’ll have to add and verify a bank account or credit card to verify your Paypal Business account.

To set up a business PayPal account you’ll need⁵:

• Your name, nationality, date of birth and home address
• Business name and address
• Business category and sub-category (from drop down lists provided)
• Business URL, country and credit card statement name

Once you’ve completed this process you have to add and verify a bank account⁵:

1. Within your PayPal Business account click Money
2. Select Add a new bank account
3. Enter your account sort code and account number
4. Click Agree and Add
5. Select Submit Pre-approved Payment Instruction - PayPal will deposit 0.01 GBP into your nominated account
6. Log into your bank account to get a 4-digit confirmation code which will show next to the PayPal deposit
7. Confirm your bank on PayPal by entering this 4-digit confirmation code

FAQs about Paypal Business account set up

How much does it cost to set up a Paypal Business account?

The Paypal Business account is free to open, however other PayPal merchant fees apply to the transactions you make.

As we mentioned earlier, PayPal Business fees don’t work in the same way that PayPal personal account fees work. Some costs are very important to watch out for - particularly if you’re taking international payments. In this case, you’ll pay the domestic commercial transaction fee for that transaction type (1.2% - 2.9%), plus an international fee of 1.29% - 1.99%. If you need to convert currencies at any stage of the transaction, or to withdraw to your UK bank account, there’s a conversion cost of 3%.

It’s important to read through the PayPal merchant fees⁶ carefully - you might also want to compare against an international alternative like Wise Business to see which works best for you.

💡Learn more about Wise Business

How long does it take to set up a Paypal Business account?

Setting up a PayPal account shouldn’t take too long. In fact, PayPal reckons it’ll take you about 10 minutes to set up the account, and then a further 5 or 10 minutes to link your bank account. The key reason there may be a delay is if the PayPal deposit to your bank account for verification is delayed at all. That’ll depend on your own bank’s processes, as well as other factors like the time of day.

If you’ve got concerns about the process or if verification is taking too long, check out the PayPal Help Centre for more information.

Can I set up a Paypal Business account without a registered business in the UK?

You’ll need to have a registered business in the UK to get started with a Paypal business account⁷. If you don’t have a UK registered business yet, a PayPal personal account might suit you better. You can still use a personal PayPal account to make payments and to occasionally take payments - when selling things online after a clear out or as a hobby, for example.

Wise Business: an alternative to Paypal

PayPal Business has some handy features and benefits - but it’s not the only option. Compare PayPal with Wise Business to see which suits your business better.

Learn more about how to open a Wise Business account here.

With a Wise Business account you can hold and exchange 40+ currencies with the mid-market exchange rate and low fees from 0.41%². You’ll also get local account details for 9 currencies to get paid by customers around the world conveniently. Add these details to invoices, or use them to get paid through PSPs like Stripe and platforms like Amazon, from over 30 countries.

Wise also offers business friendly perks like expense and debit cards, batch payment solutions, low cost transfers to 80+ countries, an API to automate workflow, and cloud accounting integrations to save admin time. That can make a Wise Business account the perfect way to focus on connecting with global customers, and to grow your business across borders.

Get started with
Wise Business 🚀

Opening a PayPal Business UK account isn’t hard to do, and you’ll be able to get everything organised with nothing more than your phone or laptop. However, before you set up a PayPal Business account it’s important to familiarise yourself with the features and fees - as these are quite different to those you’ll find with a PayPal personal account.

While PayPal is convenient and popular across many payment types, it’s not necessarily the cheapest or most flexible, particularly when it comes to international transactions. Compare your options with PayPal Business against a specialist international account provider like Wise Business. You might find you can save.

Sources used in this article:

Sources last checked June 27, 2023