To receive payment with paypal, it depending on your country as well as if you’re a business or individual. Also depending on the origin country of the payer. To keep things simple – Assuming both the sender and the receiver are in the US, either a business or individual, the receiver will need to open a PayPal account. Once done, the payer may choose to pay using his PayPal account or not if doesn’t have one.
Sending funds:
If the payer has a PayPal account as well as balance equal or greater than the amount to be paid then the funds may be transferred from his PayPal account to your (receiver’s) PayPal account.
If the payer has a PayPal account with zero balance or balance lower than the amount to be paid, he may choose the source of funding between credit / debit card, bank account, PayPal balance or a mix of PayPal balance with another source. In this case the money will again be funneled via PayPal to your (reveiver’s) PayPal account.
If the payer doesn’t have a PayPal account – he may still pay using a debit or credit card. PayPal will still process the payment, act as the payment gateway, and transfer the money to the receivers PayPal account.
Receiving the funds:
The receiver may choose to either keep the money in his PayPal or withdraw from PayPal to a traditional bank account. If funds kept in PayPal, they can be used to donate or purchase goods or services from any merchant, organization or individual who accept PayPal.
In all the above scenarios the default account identification method is email address. Unlike traditional bank account which are associated with account numbers, PayPal account are identified by email address.
Also, PayPal must know the receiver’s email address. This can be done either when paying when purchasing online, transferring money directly between two accounts or by the receivers sending a money request invoice to the sender.