PayPal was one of the first digital payment platforms to be established, allowing customers to shop and send money online - and letting internet entrepreneurs receive fast and simple payments. If you run an online business, use marketplace platforms like Etsy or eBay or receive an income through selling on social media, you may be considering a business PayPal account.
This guide will run through all you need to know including PayPal transaction fees to receive, send and withdraw money - and how to set up your Singapore PayPal business account.
We’ll also cover how to save when sending or receiving money across borders, using a Wise business account. If you trade internationally, or have your eye on global growth, Wise can save you up to 19x compared to PayPal, with low cost, secure international payments which use the real mid-market exchange rate.
Before choosing to open a business PayPal account, you’ll want to dig through the account terms and conditions - and take a good look at the PayPal charges for Singapore, to make sure there are no unexpected costs.
We’ll take a closer look at the key charges you need to think about a little later, but let’s first run through the fees if you’re receiving a payment for a product you’ve sold to a customer in Australia.¹ There are 3 key costs you need to know about:
- Commercial payment fees
- Currency conversion costs
- Withdrawal charges
Whenever you receive a payment through PayPal you’ll need to pay a commercial payment fee. This applies to both domestic and international sales.
- Commercial Payment Fee of 4.4% plus fixed fee
- Fixed fee set by currency - for our sale in AUD, you’ll pay AUD0.30
In our example, you’re selling to a customer in Australia. That means that, to withdraw your payment later, you’ll need to convert the AUD you’ve received into SGD. In this case you’ll need to pay an extra fee which is rolled into the exchange rate used for currency conversion.
- Currency conversion fee of 3%
Depending on how you choose to withdraw your money, there may be an extra fee here.
The good news is that it’s usually free to withdraw SGD to your local, linked bank account, which can save you money. However, if you want to withdraw to a card there’s a charge of SGD0.50 - SGD15 per withdrawal.²
While PayPal offers great services for many individuals and businesses, it may not be the cheapest way to get paid internationally. As an online entrepreneur, you’ve got the opportunity to connect with customers globally - so finding ways to pay and get paid across borders for less can save you money and help your business grow. That’s where you need Wise.
Open a Wise business account online to hold, send and spend in dozens of currencies. Manage your money and currency conversions on the go using the Wise app, and get the real mid-market exchange rate with no hidden fees, every time.
You’ll also get a linked debit card to allow you and your team to spend and make withdrawals all over the world, and your own unique bank account details to get paid like a local in major currencies. Get Wise today - and start to grow your business internationally right away.
Join over 10 million people and businesses already using Wise
Open your account for free
Now we’ve covered an overview of PayPal’s transaction fees, let’s break them out one by one.
Firstly, it’s worth knowing that the services available to you when using a PayPal business account may vary from those you’re used to as a PayPal personal account holder.
|❗Make sure you’ve familiarised yourself with which types of transactions are allowable from a PayPal business account before you get started.|
When it comes to transferring your money out from your PayPal business account, you’ll be able to send money to contractors and vendors, and make payouts to businesses.
You can also withdraw your income to your own account or card. However, you may not be able to make personal payments from your business account.
The costs of sending money will vary depending on whether it’s a domestic or international payment.
Domestic payments where there’s no currency conversion involved are usually free when you fund them with your existing PayPal balance. You’ll also be able to choose to make a PayPal Payout - a group disbursement to many people at once - which may save time but does involve an extra cost. We’ll cover this in a little more detail later.
If you’re sending money internationally and require currency conversion, you’ll want to check the fees which may vary depending on the currency involved. Your recipient may also pay charges to receive the money, and will need a PayPal account themselves to access the transfer.
PayPal’s fee for receiving a commercial payment is made up of a percentage cost and a fixed fee which varies by currency. Here’s what you need to know:
|Payment type||PayPal commercial payment fee|
|Domestic payment in SGD||4.4% + SGD0.50 fixed fee|
|International payment||4.4% + fixed fee depending on currency of payment|
Of course, once you’ve earned money online and had it paid into PayPal, you’ll want to withdraw it to your regular bank account to pay for daily life. You’ve a few options here. You can withdraw your funds to a linked SGD account, to an account denominated in USD, or to your bank card. If your funds are held in foreign currencies you’ll need to pay a currency conversion fee in addition to any costs for withdrawal.
Here are your options:
|Withdrawal type||PayPal withdrawal fee|
|Withdrawal to linked SGD bank account||Free if funds are already held in SGD Currency conversion fee applies to any balance held in a foreign currency|
|Withdrawal to USD denominated bank account||3% + any relevant currency conversion fee|
|Withdrawal to a card||SGD withdrawals incur fees from SGD0.50 - SGD15|
We’ve already mentioned that the exchange rates used by PayPal to convert currencies include a currency conversion fee. But what does this really mean?
To understand the PayPal exchange rate you first need to know about the mid-market exchange rate. That’s the rate you’ll find on Google, or when you use an online currency conversion tool.
|The mid-market rate is a good benchmark because it’s the exchange rate given to banks and currency services when they trade on global markets. 📈|
However, it’s not necessarily available to retail customers. Instead, many platforms, including PayPal, choose to add a currency conversion fee to the exchange rate they use. This can make it harder to work out the real costs of international payments - and push up the price overall.
PayPal uses a currency conversion fee of 3% for commercial payments. While this is a common practise, conversion fees aren’t inevitable. You may find you can get a better deal if you choose a specialist like Wise for your international transactions.
A PayPal business account gives you lots of tools and features to help your business run smoothly. Here are some of the highlights:
- Receive payments domestically and internationally
- Sell online, using email and social media
- Send payments to vendors and contractors
- Request payments and prepare invoices
- Use PayPal Payouts to send mass payments and save time
- Manage your account using the PayPal app
- Benefit from fraud protection and risk management tools
- Use the PayPal resolution centre to support customer service
- Withdraw to your SGD or USD bank account or a bank card
- Add team members to your account
- Get reports and insights into customer and business data
One thing PayPal does well is making it quick and easy for customers to buy - and for business owners to make payments when required. With PayPal One Touch, customers can make a payment with just one click - rather than needing to enter their billing and shipping information every time⁴. This can mean more sales, and fewer abandoned carts.
And for the business owner, there’s also the mass payment option PayPal Payouts. This means you can send money to multiple people at once - if you run your payroll through PayPal for example.
PayPal Payouts can be a smart way to save on admin time - but there are fees for this service which you’ll need to weigh up. Making a PayPal Payout will cost you 2% in fees, to a maximum of SGD80 if you’re paying out in Singapore dollars.
Ready to get started? Setting up a Singapore PayPal business account is easy. Just follow these steps:
- Head to the PayPal website and select the option to create an account
- Follow the onscreen prompts to enter your personal details
- Confirm your email when requested, by clicking on the link you’re sent
- Add a linked bank account to receive payments
- Add your credit or debit cards which can be used for payments and withdrawals
Once your account is up and running you can choose which PayPal payment options will work best for your business, and start taking sales.
There’s no denying that PayPal revolutionised the way people shop and send money online. And as a business owner having PayPal as a payment option can be an attractive option. However, it’s worth researching the range of fees and charges you’ll need to pay when using PayPal.
Depending on where and how you do business, you might find you’re better off with a different option - or combination of options - including a specialist multi-currency account from Wise to help you receive and send international payments for less.
- PayPal User Agreement
- PayPal Fees for Sellers (Business)
- Make Payments | PayPal Business Payment
- Faster Checkout with PayPal One Touch™
- PayPal Singapore - Setting up business account
Sources checked 1st June 2021
This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from TransferWise Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.
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