More than 70 percent of all eBay sellers offer PayPal as a payment option, and a large chunk of PayPal's business still comes from online auctions [ref]. However, one of the keys to PayPal's success has been its ability to expand beyond the eBay market. You can use it send money to a friend, donate to a charity and buy items from online merchants. If you want to donate to a charity using PayPal, the process is just like sending money to anyone else. You need the charity's email address, or they might have a button on their website that allows you to make a donation directly. The main difference lies in the "Category of Purchase" entry on the PayPal payment page. Technically, this would be a quasi-cash transaction. However, such a transaction could be subject to fees, depending on the source of the money -- if you draw your PayPal funds from a credit card, you might be charged cash advance fees. You can just as easily select "Service" as the category, and the donation will work with no problems or fees.
You can use PayPal to purchase goods from non-eBay merchants who have set up a PayPal storefront. Once you've selected your items, go to the Web site's checkout page. You will have the option of selecting a credit card or PayPal to pay for your purchase. Selecting PayPal may send you to a login page for your PayPal account. There you can transfer the appropriate amount to the merchant, who will then complete the sale. Some merchants integrate PayPal into the Web site, meaning that you put your PayPal information directly into their site.
If a Web site only accepts credit cards, you can still use funds in your PayPal account to make a purchase. PayPal users can use the "PayPal Debit Bar" to get a virtual MasterCard number. You can use that card number with any merchant who accepts MasterCard, and the funds will be deducted from the PayPal account. This service is free.
For example, you might want to use your PayPal account to buy something from Amazon.com. However, Amazon doesn't accept PayPal as a payment method. You can activate the Debit Bar from within your PayPal account. Assuming you are carrying enough of a balance in your account to cover the purchase, PayPal will give you a 16-digit number, just like a credit card number. Then you will select MasterCard as your payment method from Amazon's payment page and enter the Debit Bar number.
In the next section, we'll see how merchants can use PayPal to accept
