Can I use PayPal instead of a business bank account?

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Hi there

I’m weighing finance options for a new business I’m planning to start, and I’m stuck on business banking. Everyone recommends using s business bank account, but would I be okay to simply use an online platform like PayPal instead?

Many thanks for your help!

Answers

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You will still need a bank account to pay for goods and withdraw funds through Paypal. You can use your personal current account but I would not recommend doing this because it will be more difficult to keep track of business finances and work out your accounts and tax returns at the end of the year. It’s better to have a separate business bank account.

You can certainly use PayPal as your only payment option for clients, rather than setting up a Merchant account as well. However, it would be more beneficial to offer an alternative payment method to your customers because they will require a Paypal account to pay for goods through Paypal. Not everyone has one, and some people will not want to set one up so you may end up losing sales as a result. It’s better to give your customers the option of paying for goods with their credit/debit cards through a different payment processor.

a year ago
 

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