What you need to create a PayPal account

You can open a PayPal account in about 10 minutes with an email address, a password, and basic personal information. PayPal does not charge you to create an account or to keep it open. You will need to provide your name, address, phone number, and date of birth during signup. If you want to send money or receive payments beyond a small limit, you will also need to link a bank account, debit card, or credit card to verify your identity.

PayPal has two account types: Personal and Business. A Personal account is free and works for sending money to friends, paying bills, and making purchases online. A Business account is also free but includes invoicing tools and the ability to accept payments from customers. Most people start with Personal unless they are running a business that needs to collect payments from others.

The verification step is where most new users get stuck. PayPal will ask you to confirm your bank account or card by checking small deposits (usually under $1) that appear in your bank statement within a few days, or by letting PayPal pull information directly from your bank login. The direct method is faster and usually takes minutes instead of days.

Key Takeaways

  • You need an email address, password, and personal information (name, address, phone, date of birth) to open a PayPal account, and the whole process takes about 10 minutes.
  • Linking a bank account or card is required to send money or receive payments beyond a very small limit, and PayPal verifies it by checking small deposits or pulling information from your bank login.
  • A Personal account is free and works for peer-to-peer transfers and online shopping; a Business account is also free but adds invoicing and customer payment collection.
  • Once your account is verified, you can send money using someone's email address or phone number, and they will receive a notification to claim the funds.

Step-by-step account creation

Go to paypal.com and click "Sign Up" in the top right corner. Choose Personal or Business account type. Enter your email address and create a password—PayPal requires at least 8 characters, including uppercase and lowercase letters, a number, and a special character. Click "Next" and fill in your full name, address, phone number, and date of birth. PayPal uses this information to verify your identity and comply with banking regulations.

After you submit your personal information, PayPal will ask you to link a payment method. You can add a bank account, debit card, or credit card. If you add a bank account, PayPal will either show you two small deposits to confirm in your bank statement (takes 1 to 3 business days) or let you log into your bank directly so PayPal can verify instantly. The instant method is faster and is available for most major U.S. banks. If you add a debit or credit card instead, PayPal will verify it immediately by charging a small amount and asking you to confirm the charge amount in your PayPal account.

Once your payment method is verified, your account is active and ready to use. You do not need to wait for any additional approval. You can immediately send money to other PayPal users by their email address or phone number, or use your PayPal balance to pay for things online.

Linking your bank account or card

Linking a payment method tells PayPal where to pull money from when you send a payment, and where to deposit money when someone sends it to you. You can link multiple cards and bank accounts to the same PayPal account, and you can choose which one to use for each transaction.

For a bank account, log into PayPal, go to "Wallet" or "Settings," and select "Add a Bank Account." Enter your routing number and account number (found at the bottom of your checks or in your bank's online portal). PayPal will then verify the account by one of two methods: small deposits (you confirm the amounts in PayPal within a few days) or instant verification (you log into your bank directly). Instant verification is available for most major U.S. banks and takes seconds.

For a debit or credit card, go to "Wallet" or "Settings," select "Add a Card," and enter the card number, expiration date, and CVV. PayPal will immediately charge a small amount (usually $1 to $2) to the card and ask you to confirm the charge amount in your PayPal account. Once you confirm, the card is linked and the charge is reversed. This entire process takes minutes.

Sending money to another person

Once your account is verified, you can send money to anyone with a PayPal account or email address. In PayPal, click "Send Money" or "Transfer Money" (the exact wording varies by device). Enter the recipient's email address or phone number, the amount, and a note if you want. PayPal will show you the exchange rate and any fees before you confirm.

If the recipient already has a PayPal account, the money arrives instantly and shows up in their PayPal balance. If they do not have a PayPal account yet, PayPal sends them an email or text notification asking them to claim the money. They have 30 days to claim it; after that, the money returns to your account. When they claim it, they will be prompted to create a PayPal account or link an existing one, and then the money transfers to their account or bank.

PayPal charges a fee for sending money to someone outside the United States or if you send money as a "goods and services" payment (used for business transactions). Sending money to friends and family within the U.S. is free if you use your bank account or PayPal balance. If you use a credit card to send money, PayPal charges a percentage fee even for friends and family transfers.

What happens if verification fails

If PayPal cannot verify your bank account using the small deposit method, you will see an error message in your account. This usually means the account number or routing number was entered incorrectly. Go back to "Wallet" or "Settings," select the bank account, and check that both numbers match exactly what your bank shows. If they do, try removing the account and adding it again.

If instant verification fails (when you log into your bank directly), it usually means PayPal does not support your bank yet or your bank's security settings are blocking the connection. In that case, you can switch to the small deposit method, which works with nearly all U.S. banks. You can also link a debit or credit card instead, which verifies immediately.

If PayPal limits your account during verification, it means they need more information to confirm your identity. You will see a message in your account explaining what documents or information they need. This is common and not a sign of fraud. Respond to PayPal's request within the timeframe they give you, and your account will be restored once they review your information.

Security and protecting your account

Use a strong, unique password for PayPal—one you do not use for any other website. Enable two-factor authentication in your account settings so that anyone trying to log in from a new device has to enter a code from your phone or email. This protects you if someone learns your password.

Do not share your PayPal password or login link with anyone, even if they say they are from PayPal. PayPal will never ask you for your password by email or text. If you receive an email claiming to be from PayPal asking you to confirm your account or update your information, do not click any links in the email. Instead, log into PayPal directly by typing paypal.com into your browser, and check your account from there.

Review your transaction history regularly. In PayPal, go to "Activity" or "History" and look for any payments you did not make. If you see an unauthorized transaction, report it to PayPal immediately by clicking the transaction and selecting "Report a Problem." PayPal covers unauthorized transactions on your account if you report them within 180 days.

Frequently Asked Questions

Do I have to verify my bank account before I can send money?

No. You can send a small amount of money (usually up to $500 per transaction and $1,000 per month) to other PayPal users without verifying a bank account, as long as you have a credit or debit card linked. However, to send larger amounts or to receive money from others, you will need to verify a bank account or card.

What if I do not have a bank account?

You can link a debit card or prepaid card instead. PayPal verifies debit and prepaid cards immediately by charging a small amount and asking you to confirm it. Some prepaid cards work with PayPal, but not all; check your card's terms or contact the card issuer to confirm.

Can I use PayPal on my phone?

Yes. Download the PayPal app from the Apple App Store or Google Play Store, log in with your email and password, and you can send money, check your balance, and manage your account from your phone. The app works the same way as the website.

How long does it take to receive money someone sent me?

If you already have a PayPal account, money from another PayPal user arrives instantly. If you do not have an account yet, PayPal sends you a notification and you have 30 days to claim the money by creating an account or linking an existing one.

What if I forget my PayPal password?

Go to paypal.com, click "Log In," and then click "Forgot Password?" Enter your email address, and PayPal will send you a link to reset your password. Click the link in the email and create a new password. If you do not receive the email, check your spam folder or contact PayPal support.