PayPal has announced new restrictions to a payment feature that allows users to receive money without paying extra fees. 

Only personal PayPal accounts can now receive funds through Friends & Family. This is a transaction method that is intended for trusted recipients.

PayPal offers two options for sending money: Friends & Family or Goods & Services. F&F can be used to pay your friend back for dinner or give your child some money for their birthday.

You know who is receiving the funds and for what purpose. Although there is no charge, F&F does not provide protection against any issues, such as refunds or scams

G&S is for purchases only. Money sent via PayPal is subject to PayPal fees. Everyone hates fees! G&S allows you to get a refund if your item isn't exactly as described, damaged upon arrival, or doesn't reach you

Although you are not legally required to, many businesses use PayPal business accounts to handle transactions and accept payments through F&F. Sometimes, the buyer may be unaware of the difference.

Alternatively, the seller and customer can agree to pay cash in this way to avoid seller fees.

This is quite common in informal transactions such as people selling items on social media -- maybe the buyer knows the seller personally and trusts them to deliver.

F&F can be a requirement for sellers to avoid transaction fees. However, this could cause problems down the road.

Some creators who use PayPal to manage their businesses are already frustrated by the change. They will now be subjected to additional transaction fees.

This new change will mean that US business accounts can no longer accept personal payments for fees.

Instead, people who use PayPal to pay their company's bills must set up a personal account to receive money from family and friends.

PayPal did not immediately respond to inquiries about whether it had changed the rules to stop miscategorized purchases

However, the company stated in the announcement that the tweak would "drive consistency on the platform" as well as "[remove] confusion regarding which payments are eligible to buyer and seller protections."

PayPal announced that the fee structure for transactions on goods and services will change in the next month.

Sellers currently pay 2.89 per cent plus $0.49 per transfer, but that will change starting July 28th to 2.99% without any additional flat fee.