How PayPal IPN Works

How PayPal IPN Works

IPN stands for Instant Payment Notification. It’s important to understand how PayPal IPN works, who should use it and why.

PayPal IPN is an instant payment notification system. If you’ve used PayPal much, you probably have received email notifications regarding payments made to you or payments that you have sent to others. Maybe you’ve requested refunds or raised a dispute; all the emails notifying you about those transactions are part of the PayPal IPN. The PayPal IPN’s real power, however, is its ability to help companies automate their processes. You can learn the steps of how PayPal IPN works.

PayPal Transaction Is Initiated

The IPN is instantly created as soon as any of several transactions are initiated on your website or through PayPal itself. Most transactions are payment related, like an order for merchandise, services being placed or a request to make payment by credit card. The notifications are also generated by someone requesting a refund or to cancel a payment. These transactions are still payment related even though they may be sending money in the opposite direction than a receipt of payment would.

Instant Notification Is Sent Out

Immediately, upon the processing of the sale, refund or other transaction, PayPal’s IPN service sends out an email and a specifically coded message to your listening software. The IPN service then waits for a response from your listening software acknowledging the receipt of the notification. If the IPN service does not receive a response within 30 seconds, it continues to resend the notification, seeking that confirmation of receipt.

Listening Software Automates Your Response

Your listening software will be programmed to read and properly respond to each of the different notifications the IPN service might send out. Your listening software also will be programmed regarding the automated responses that are carried out on your behalf, such as sending out an email to the purchaser that acknowledges the purchase and provides the download code for the paid-for digital product.

Who Uses PayPal Instant Payment Notification Services

Everyone who has a PayPal account is making use of the instant payment notification service. At the deepest levels of installing code and custom programming listening software, however, the process becomes cumbersome and unnecessary for the average person or company selling products or services over the Internet. Digital payment and selling platforms like incorporate the PayPal IPN service into their easy-to-use, easy-to-setup payment services. The detailed information PayPal provides about its IPN service is really not relevant for the average business. However, if you have the knowledge and the need to set up a custom IPN service to connect with your listener software, PayPal has all the information you need, right on its website.

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