PayPal is recognized as world’s first online money transfer platform used by millions of people in more than 190 countries including Nigeria and other African countries (Cameroon, Ivory Coast and Zimbabwe etc).
The American company was first established in December 1998 as Confinity – a company that developed security software for handheld devices. PayPal co-founders are Max Levchin, Peter Thiel, Luke Nosek and Ken Howery who developed and launched the company as a money transfer service.
Before now, PayPal had shut Nigeria out of its services due to the nation’s notoriety for Internet-related frauds. But as fraud detection techniques improved and Nigeria became one of the largest economies in Africa, PayPal lifted its restrictions only to allow Nigerians transfer money to other users, but not allowed to use the service to receive or withdraw funds.
Functions of PayPal
Paypal is an online financial transaction company that allows users send or receive payments for online auctions on websites like eBay, purchase or sell goods and services, or donates money/receive donations. According to one of the company’s founders Thiel, the company is not a bank because it does not engage in fractional-reserve banking.
However, PayPal is subject to some of the rules and regulations governing the financial industry including Regulation E Consumer Protections and the USA PATRIOT Act.
It is also important to note that PayPal ended its operation of Student Accounts in August 2016, which allowed parents to set up an account for their children schooling abroad, transfer money into it and obtain a debit card for student use.
How to Set Up PayPal Account in Nigeria
It has become quite easy and convenient to open and operate a PayPal account in Nigeria anytime, anywhere. To open the account is quite easy with the following steps:
- Click on PayPal official website.
- Search for the ‘Sign up for free’ button which offers registration of an account with the company.
- The sign-up button offers two options for you to select an account that suits you – Personal account or Company account you may wish to represent. Note that each account requires different sets of documents.
- One of the choices you click on will lead you to a page where your information is required. This includes your country of residence which comes first.
- The next tab allows you enter your email in order to receive valuable information or invoices from PayPal.
- Also, the system will ask you to create and confirm a password to enter your personal account online.
- Fill other personal information – name, date of birth, home address, and phone number.
- You are to ensure that all the information provided are the same as the one you used when opening your bank account.
- The system will also request for the information on your bank debit account in order to proceed with the money transfer.
Verifying and Operation of your PayPal Account
In order to verify whether the card you wish to use is connected to your new PayPal account, simply follow these few steps:
- Check your card and enter the numbers you see on its backside into the specified tab. As well as the card’s expiry date.
- An email will be sent to your mailbox shortly after this which will contain a clickable link to verify your account.
- Then your PayPal account is ready.
- To test how smooth your new account works, try sending some amount of money to a friends/family’s account.
- Also check the currency of your account, to ensure it’s the one used in your state.
PayPal Currency Exchange Rate In Nigeria
Users of this online financial transaction platform are expected to know the current exchange rate and transaction fees which depends on the amount of money a user sent through the system. The PayPal dollar to Naira exchange rate is calculated using the PayPal Fee Calculator which uses the official naira per dollar rate of N316 for $1.
As part of the company’s policy, there are no charges if the user wants to purchase goods or services. But if a customer is to receive money for goods or services (in the case of selling an item on eBay), the transaction fee will be 2.9% plus $0.30 USD of the amount you receive.
In the case of fund transfer, the more money a user puts on his PayPal account, the smaller the fees. For instance:
- To send $3,000 per month, the user will have to pay 3.9% + $0.30 USD.
- To send $3,000 – $10,000, the fees would be 3.4% + $0.30 USD.
- To send $1000,000 a month, the customer will have to pay a commission of 3.2% + $0.30