Of course, everybody knows PayPal. It has been the de facto method of making payments online without giving individual sites your credit card number or bank account information. But many people do not know that PayPal also offers the means for individuals to accept credit card payment online without a traditional merchant account.  

The easiest way to get started taking credit cards with PayPal is to simply get a PayPal account. The caveat here is that you will be limited to withdrawing a maximum of $500 per month. If you are only doing a small volume of payments through PayPal, then this solution is more than adequate.

If you are doing more than $500 in volume per month, you need to upgrade to a Premier account and verify your account. This can be done by providing your bank account information (for withdrawals) and some personal information. In my case it was a Social Security Number.

PayPal's discount rate is 2.9% + $0.30 per transaction. This is higher than most merchant account providers, but there are no monthly fees or minimums to meet.

Because PayPal's discount rate is higher than most merchant account providers, a traditional merchant account may be more appropriate if you do enough volume. There is a detailed comparison of PayPal vs Merchant Accounts which offers a spreadsheet to analyaze at what point PayPal becomes more expensive than the merchant account plus its monthly fees.