Introduction to PayPal Payments

New merchants may benefit from the following introductory payments information.

Authorization and Capture

Authorization and capture, or Auth/Capture, is specific to direct credit card payments. It allows you to authorize the availability of funds for a transaction but delay the capture of funds until a later time. This is often useful for merchants who have a delayed order fulfillment process. Auth/Capture also enables merchants to modify the original authorization amount due to order changes occurring after the initial order is placed, such as taxes, shipping or gratuity. (More about authorization and capture with PayPal Express Checkout)

Recurring Payments

PayPal Recurring Payments allows you to bill a buyer for a fixed amount of money on a fixed schedule. (More about recurring payments with PayPal Express Checkout)

Note: You can also set up another form of recurring payments using reference transactions to handle payments for varying amounts of money on a varying schedule.

Reference Transactions

A reference transaction is a financial transaction from which subsequent transactions can be derived. For example, a buyer purchases an item on your site, and you use the PayPal transaction ID or reference transaction ID later to initiate another transaction. Reference transactions and billing agreements also enable you to handle recurring payments for varying amounts of money on a varying schedule. (More about reference transactions with PayPal Express Checkout)


You can issue a full or partial refund for a transaction. The refund process you use differs if the refund is issued within 180 days of payment or after 180 days from payment. (More about refunds)


PayPal provides you with various reports to help you run your business. (More about reporting)