Blog Posts

PayPal Got you Worried? How to Diversify Your Income Streams

It’s another Expert Briefs, where I ask really smart business owners to answer your burning questions.

If you've missed past Expert Briefs, you can click on the undies to see them all –>

This week I asked our panel of experts …

With PayPal lately banning Internet Marketers – how do you personally diversify the income streams in your business?

I think you'll find the answers this week interesting and very helpful.

terryTerry Dean of My Marketing Coach says:

I currently accept orders through Paypal, Clickbank, and my own merchant account. Merchant accounts may not be for someone who is just getting started, but as soon as you have to ask about “diversifying” your income, you should definitely have your own. It gives you the most control of what you're doing and how you're processing orders.

In my main shopping cart, customers can choose to pay by credit card or by Paypal during the order process.

One of the big elements to mention here though is prevention. When dealing with a large company like Paypal, they can make some random decisions at times. So nothing is foolproof, but here are a few things you should always do.

  • Make sure you communicate with them. When you're going to have a surge in orders, let them know.
  • Communicate with customers and keep claims to a minimum.
  • Be careful about any income claims or weight loss claims on your site (both major issues).
  • Be careful what you're offering on your site. Remember, Paypal doesn't like 2 tier affiliate programs in most cases, for example.

Jeanette S. Cates, PhD of Organize Your Online Business says:

I've not personally had any problems with Paypal, but I work hard to keep down my refund rate. And in 99% of my products, I also provide a credit card option for buyers. With my less expensive products people tend to use Paypal. But with my more expensive products and larger orders I see more credit cards coming through.

There are so many options for taking money online now that I don't think anyone should be held hostage by a single payment method. With Google checkout and Clickbank everyone can take payments online.

If you want your own merchant account I highly recommend iPowerPay – they understand Internet marketers and work with many of the largest marketers, so you don't have to worry about them “freezing” your account.

kellyKelly McCausey of Solo Smarts says:

If PayPal were to slap me tomorrow I'd survive. I do have a separate merchant account that feeds payments from credit cards directly into my checking account. Right now I only use it has a back up for those who don't like using PayPal but I could swiftly move my ecommerce over to use that as primary.

A couple big income streams I've developed have nothing to do with PayPal. My blog ad network is paid by monthly check and one of my partnerships is paid through direct bank transfer. I love that I'm not paying big PayPal fees on these payments each month.

The biggest challenge I'd face would be paying my affiliates. If I can't use PayPal I'm going to end up writing checks and that is so much more time intensive. I hope I never have to deal with it.

RonnieRonnie Nijmeh of (< -click for a special free offer from Ronnie) says:

Firstly, I try not to worry too much about Paypal banning accounts. I mean, I'm not doing anything wrong and I try to be as legit and “legal” as possible.

My company is a registered corporation here in Canada. I have my phone # and address on my site, in the footer, etc. I keep money inside of Paypal (instead of siphoning it out immediately, which would seem suspicious, right?). I pay my staff mainly through Paypal, so Paypal sees that it's not just money coming in and withdrawn to my bank account.

The bottom line is, I use it like I would a regular bank account and don't do anything crazy. 🙂

With that said, I also have a merchant account that I use to diversify my payment options. Some clients prefer to avoid Paypal anyhow, so I can accept credit cards without having to deal with Paypal.

Since I'm in Canada, I use – they seem to be really solid… the support is awesome and responsive, and they even have an iPhone app I can use to collect money in person (although, since I'm entirely online, I haven't tried it).

The key is to be smart – setup accounts with other payment services and merchant accounts, honor your guarantees, and don't worry about it.

NicoleNicole Dean of .. here! .. says:

I've heard of people losing their paypal accounts since I came online nearly a decade ago and it is still a looming fear of many.

The more things change, the more they stay the same, right?

I decided awhile ago to have multiple types of income streams outside of Paypal – but then I slacked on it a bit until recently when the buzz about Paypal banning Internet Marketers came up again.

Like my very smart friends have said in their answers above, there are really two issues at play here when it comes to Paypal.

  1. Prevention. What to do to keep your PayPal account.
  2. Insurance. What do have in place in case you lose your PayPal account.

Let's address each individually.


Terry and the others were spot on in my opinion. Here's what I'd say is important.

1. Play by the rules.
If you're using PayPal, you want to always be aware of what their rules are and understand one fact. They are the judge and jury of their own kingdom and we are merely visiting. Yes, we make them money through our transactions, but in the end, what they decide is law. So, read up on their rules and stay informed to make sure you're on their good side and you stay there.

2. Be CLEAR on your sales page.
Make sure what you say you're selling is very very clear – and you deliver as promised.

If you use the term “book” in your sales copy, clarify multiple times if it's really a downloadable book, so the customer isn't waiting by their mailbox day after day, getting more and more upset about their order that didn't arrive. (This is obviously more important in certain niches than in others.)

If you say “videos” make sure you explain that the videos are in mp4 format, in case the customer lives in a town just east of Boondocks and south of Nowhere where he only has a dial-up modem.

This will help keep people from starting disputes against you.

3. If customers complain about something being unclear during your ordering process – FIX IT!
This feedback is golden. Listen to your customers and try to fix what you can. If you can't fix it, then be very clear up front so that customers know what to expect.

For instance, my shopping cart had a setting where downloads expired after 48 hours. There's nothing I could do about it for a long time. So, I put a note in bold on the order page that said “Please download your order immediately. The link will expire in 48 hours. If you have any issues or need this link reset, please contact (and I had the support link)”. This helped people to actually access the products they paid for…. kind of an important thing.

4. Make your support desk easy to contact.
There have been a few times when I've ordered something and could not contact the person through any means when I had an issue.

  • I tried the website. Nothing.
  • I tried to reply to an email.
  • I tried to reply to their paypal email address. No response.
  • I even googled the person, trying to find their help desk. No luck.

They left me with no option but to file a Paypal dispute. Don't force your customers to resort to contacting PayPal.

5. Like Terry said, communicate directly with PayPal.
If you have an issue, pick up the phone. I know, as Internet Marketers, most of us hate the phone – but, in my experience, the people at PayPal want your business account with them to remain in good standing – and will help if they can.

6. Be careful in setting up multiple accounts.
I've heard through the grapevine that transferring money through multiple accounts can raise a red flag.


The next part of your protection is what I call Insurance and this is where the diversification part comes in.

I, personally, get paid from a variety of sources – which helps me to sleep at night, in case, God forbid, I were to lose my PayPal account.

1. Google Adsense.
I still receive deposits directly into my bank account from Google Adsense (from some of my niche sites). The deposits aren't as big as they used to be, but they're big enough to make a difference if I needed the money.

2. Clickbank (as a product seller).
I have several products on Clickbank for a few reasons. You'll see that I run through Clickbank and, too.

Why? The first reason is because I love how easy Clickbank makes it for me to use them. It's very hands-off for me – which is important, especially in the branches of my business that are not the core of what I do. The second reason is because the money gets deposited directly into my bank account – which is another separate income stream for me.

You can learn how to put your products on Clickbank here -> How to Sell your Products on Clickbank.

3. Promoting Affiliate Products that Pay in Various Ways.
I promote a few affiliate programs that pay by check and/or direct deposit. I didn't choose these affiliate programs because they paid via check or direct deposit. I chose them because they were good. The payment part was just a lucky coincidence.

A few to look into are ->,, and – (and, of course,

4. Offline Clients.
I also dabble a bit in the offline world where I have a few clients. If I were in a position where I needed a quick influx of cash, I could easily go to them with more offerings or ask for referrals to bring in more income quickly – outside of PayPal.

5. Partnerships.
I have one partnership where my business partner pays me with direct deposit every month.

6. Merchant Account.
I had a merchant account, but let it go. (Long story.) I am ready to try again and will be looking into iPowerPayas I'm impressed by them.

Last year, I spoke with their reps at an event in Orlando and really liked their commitment to Internet Marketers. So, watch for that update soon.

7. Amazon Kindle.
One of my most favorite revenue streams is from publishing on Amazon Kindle. In fact, I plan to do it more in the coming months. Amazon Kindle deposits money into my bank account and it's totally hands-free for me. I don't even have to do my own customer support. Thank you, Amazon!

I may be forgetting something. If I think of it, I'll add it below. 🙂

So, how about you?

Got questions? Got resources? Please share below.

Thanks for stopping by!

Much love,

PS. Resources –

Here are the resources mentioned in this post:

PS Again – The Experts –

I appreciate shares and I adore comments! Please share your thoughts.

  • Jeff

    I don’t understand paypals ways. I turned in an online marketer for advertising buy 2 get 1 free. It was a reorder that I’d ordered a couple of times before. When the order came there was the 2 but not the 1 free one. I took a screen shot of the web page sent it to the marketer who got pretty rude basically saying too bad you are not getting it even though it was advertised. So turned them into paypal but they apparently can’t take proof of screen shots or attachments. They ruled in favor of the thief marketer. Needless to say I will never order wild oregano oil again from healthy health. Bad thing is they could care less and don’t care they lost a repeat customer that moved their product to other people. Paypal likewise doesn’t seem to care I will move my merchant account from them as well. I did fill in their survey asking how I liked their arbitration. I doubt if they read it since it was not favorable.

    • Nicole

      I have been on the vendor end and the customer end with Paypal disputes and have been really confused on both sides.

      1. As a customer, I bought something and never was able to get ahold of the seller to get it. I didn’t get it. Period. During the dispute the seller never responded. I still lost. No idea.

      2. As a vendor, I’ve been able to prove not only that the person bought the product but they downloaded it and to show emails going back and forth – and lost.

      Very confusing. I do love Paypal and I don’t mean this to be a PayPal bash – but the results of the disputes tend to be rather inconsistent in my experience.

      Thanks for commenting.

  • Rhonda

    Well, I was hit from Paypal a couple of weeks ago. It was a very scary moment…since I’ve tried to follow all the rules. Sometimes you need to speak up and ask questions too to get to the root of the problem.

    Thankfully, my issue was resolved by the next day and my funds were open again. It seems that there was a misunderstanding with an affiliate program I was involved with that had instant payments to my paypal account. Paypal thought the site was mine and that I was involved in MLM or something. I contacted the affiliate program owner and they updated their site to take off promoting the affiliate program on their sales page. So, there’s lots of little issues to be aware of and watch out for. Just educate yourself.

    • Nicole

      eek! Rhonda, how scary.

      I forgot to mention that I pulled most (hopefully all) promotions for WSOs that I’d been promoting and removed my paypal account from JVZoo, too. Both seem to be getting targeted for “Instant payments” to affiliates.

      Stop by and share more if you hear anything else, please.


  • Simmeon

    Only yesterday Paypal have removed my primary payment source.
    No warning, nothing.

    They can leave people vulnerable is you have no backup solution at hand.
    I don’t suggest using Paypal for any real business or as a main payment gateway.

    For a personal capacity sure, why not!

  • Gabrielle Fontaine

    Thanks for this article, Nicole. It’s excellent! Appreciate the input from your experts too.

    Like several of your experts and commenters, I use PayPal both for downloadable products, as well as with direct clients. I also use Clickbank and DigiResults for my product affiliate programs. DigiResults works through PayPal and does allow instant payments, but they give you to control over which affiliates get instant payments and which have a waiting period. I like that a lot and have had no trouble whatsoever with it so far. I also use PayPal like a regular bank account.

    Like you, much of my income goes directly into my bank checking account, and I get regular payments directly from Amazon and some from paper checks and direct deposit (ACH transfers).

    As a professional bookkeeper, the advice in this article is excellent for ALL small business owners! You should diversify your income streams and have more than one place to receive payment so you could survive some crazy corporate decision or even a hijacked or fraudulent situation.

    Thanks again! 🙂


    • Nicole

      Fraudulent situations is another VERY important reason to diversify. Thank you so much for sharing your insights and expertise with us, Gabrielle! Come back soon. 🙂


  • Theda Erickson

    Hi Nicole

    Pay Pal put a hold for 21 days on my money, and said they would review my account every 35 days.
    I use others like these.
    SolidTrust Pay.
    Alertpay now called Payza
    Solidtrustpay and Nxpay are good for all over
    Payza is in a transition with the use of credit cards, but will have it all taken care of soon. I have used them more than the others.

  • Ruth P

    I think one of the most important points in this article is to make sure everything is clear for your customers, for example the note you put about downloading orders immediately. I’ve come to realise this lately – some people are not as savvy with online payments/ downloads as you might expect. It’s not their fault, and it’s up to us to make things as crystal clear as possible to avoid misunderstandings and payment claims in PayPal.

  • Christine Holroyd

    Thanks for all of the info here. I’m just starting an Ebay biz. I need to know as much as possible. So do I understand that if I suddenly start having an influx of payments to PayPal from products sold, that it’s best to let them know?

    I’d like to be in the position of having to worry about these things one day. hehe.

    Shall bookmark this page for future reference 🙂


  • JW Ginn


    This is an awesome topic. It is one that is relevant to me as I worked for Paypal up until 5 years ago.

    A couple of things that I advise people to do:

    1) Read the buyer and seller agreements. Know your rights and specifically what IS and IS NOT covered. I will say that I learned to read TOS and agreements because of my time at Paypal.

    2) Big evil Paypal is not out to get you. Unfortunately there are hundreds and thousands of criminals that try to filter money through Paypal. Seeing some of the things I saw caused you to be somewhat suspicious.

    3) Your site needs look professional. If I come to your site and I see that it looks amateurish – I am going to lean to the side of caution.

    4) Be easy to contact. Do not put a Skype # that you never answer on your website. Paypal will often try to call you when investigating fraud. Answer the call!!

    5) Paypal hates sites that brag about clicking buttons and making millions. If it smells scammy, over the top, etc… you make get into Paypal’s crosshairs.

    Those are just a few things that come to mind.

    As always, I love the work you do.


  • Danyelle Franciosa

    Such a good information about diversifying your income. Many people got some mistake about this and I think that it is really important to diversify your income especially when it comes to paypal.

  • Towhid Zaman

    This is amazing. This is probaably the best article I’ve read about paypal.Thanks to all of you for sharing your experience & suggestion. Paypal surely a scary part for startup marketers..

Leave a Comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.