There's no problem if the recipient is not yet a PayPal user. He or she simply registers at PayPal after receiving an email notification, and is immediately credited with the amount in the new account. Funds may be withdrawn at any time by direct deposit to a bank account or a personal check from PayPal. Users may also opt to send the money on to others.

A Real-World Example

Let's take a real-world example. Andy owes Betty $50. He wants to use his credit card to pay her. But Betty does not accept credit cards. So Andy decides to use PayPal. Here's how each step of the transaction would work: 

Action	Information entered
1. Andy logs on to PayPal.com and registers.	Andy's name Andy's address Andy's email
2. Andy sends $50 to Betty by entering his credit card information, her email address, and the amount ($50).	Andy's credit card Betty's email Transaction amount
3. Andy's credit card is charged $50 and a new account in Betty's name is created and credited with the $50.
4. Betty receives an email notification ("You've got cash!") and clicks on a link which takes her to her new account.
5. Betty registers by entering her name and address.	Betty's name Betty's address
6. Betty can withdraw her money by direct deposit to her bank account or by a personal check from PayPal. Betty also has the option of sending the money on to others.	Betty's bank account (if withdrawing by direct deposit)