How to Set Up PayPal Integration with PHP & MySQL

PayPal is the most popular payment service on the web so being able to integrate your website with PayPal’s Instant Payment Notification Service (IPN) is essential if you need to process payments through your website.

There are 3 main parts to the PayPal IPN system.

  1. A webpage that initiates a request to PayPal to make a payment.
  2. A PHP page on your webserver that PayPal calls to notify you that payment has been made.
  3. A webpage that confirms the above payment and continues on to the next phase of your web application, such as a ‘Thank You’ page.

Parts 1 and 3 are accessible by customers on your website. Part 2 is only visible to PayPal.  The diagram below illustrates the interaction between your customer, PayPal and your website.

PayPal Interaction

The following steps break down each part of the process into easy to follow chunks, it is assumed that you have knowledge of PHP and MySQL.

Step 1 – Setup PayPal Account

Sign up for a PayPal account if you don’t already have one. Select an appropriate account type, either Personal or Business.

Once you have a registered PayPal account your account must be setup correctly to use IPN.

Select ‘edit profile’ from your PayPal account and check the following settings.

  • Under ‘Selling Preferences’ >> ‘Instant Payment Notification Preferences’
  • Under ‘Selling Preferences’ >> ‘payment receiving preferences’
    • Block payments from users who pay with echeck. (This is because these will not be instant payments)
  • Under ‘account information’ >> ‘email’
    • Note down your primary email address. This email will be visible to users so make it a professional one. User’s may feel apprehensive about sending money to an e-mail address with the domain ‘hotmail.com’ or ‘Yahoo.com’ etc…

Step 2 – Simple HTML Form

Your website must now send all the required values to PayPal so that the payment can be processed.

The following code example demonstrates a basic form that we will use to send the values:

cmd” type=”hidden” value=”_xclick” />


The business name, price, submit type, notify URL and other sensitive values will be sent during the next step.

A full list of the values to send can be found at the PayPal website under the title “A Sample IPN Message and Response”.

Step 3 – Payments.php (The Request)

The payment.php page will be used to handle the outgoing request to PayPal and also to handle the incoming response after the payment has been processed.

The following sample code shows the querystring being constructed before it is posted to PayPal. Here you can specify the following values:

  • Business ($paypal_email) – Enter the email address of your PayPal account.
  • Item name ($item_name) – The name of the item being purchased.
  • Amount ($item_amount) – The price of the item.
  • Return ($return_url) – The address to return to after a successful payment.
  • Cancel Return ($cancel_url) – the address to return to after a cancelled payment.
  • Notify URL ($notify_url) – The address of the payments.php page on your website.
  • Custom – Any other data to be sent and returned with the PayPal request.
// Database variables
$host = "localhost"; //database location
$user = ""; //database username
$pass = ""; //database password
$db_name = ""; //database name

// PayPal settings
$paypal_email = 'paypal@example.com';
$return_url = 'http://example.com/payment-successful.htm';
$cancel_url = 'http://example.com/payment-cancelled.htm';
$notify_url = 'http://example.com/paypal/payments.php';

$item_name = 'Test Item';
$item_amount = 5.00;

// Include Functions
include("functions.php");

//Database Connection
$link = mysql_connect($host, $user, $pass);
mysql_select_db($db_name);

// Check if paypal request or response
if (!isset($_POST["txn_id"]) && !isset($_POST["txn_type"])){

    // Firstly Append paypal account to querystring
    $querystring .= "?business=".urlencode($paypal_email)."&";

    // Append amount& currency (£) to quersytring so it cannot be edited in html

    //The item name and amount can be brought in dynamically by querying the $_POST['item_number'] variable.
    $querystring .= "item_name=".urlencode($item_name)."&";
    $querystring .= "amount=".urlencode($item_amount)."&";

    //loop for posted values and append to querystring
    foreach($_POST as $key => $value){
        $value = urlencode(stripslashes($value));
        $querystring .= "$key=$value&";
    }

    // Append paypal return addresses
    $querystring .= "return=".urlencode(stripslashes($return_url))."&";
    $querystring .= "cancel_return=".urlencode(stripslashes($cancel_url))."&";
    $querystring .= "notify_url=".urlencode($notify_url);

    // Append querystring with custom field
    //$querystring .= "&custom=".USERID;

    // Redirect to paypal IPN
    header('location:https://www.sandbox.paypal.com/cgi-bin/webscr'.$querystring);
    exit();

}else{
    // Response from PayPal
}

Step 4 – Payments.php (The Response)

The next part of the payments.php page handles the response from PayPal. The response is re-assigned to variables and then posted back to PayPal for verification using fsockopen.

If the response is VERIFIED then a validation check can be performed. The check_txnid and check_price functions are called to check that the correct Transaction ID and Price have been returned. The updatePayments function can finally be called to store the details of the payment in the payments table (Step 6).

// Database variables
$host = "localhost"; //database location
$user = ""; //database username
$pass = ""; //database password
$db_name = ""; //database name

// PayPal settings
$paypal_email = 'paypal@example.com';
$return_url = 'http://example.com/payment-successful.htm';
$cancel_url = 'http://example.com/payment-cancelled.htm';
$notify_url = 'http://example.com/paypal/payments.php';

$item_name = 'Test Item';
$item_amount = 5.00;

// Include Functions
include("functions.php");

//Database Connection
$link = mysql_connect($host, $user, $pass);
mysql_select_db($db_name);

// Check if paypal request or response
if (!isset($_POST["txn_id"]) && !isset($_POST["txn_type"])){
    // Request from step 3
}else{

    // Response from Paypal

    // read the post from PayPal system and add 'cmd'
    $req = 'cmd=_notify-validate';
    foreach ($_POST as $key => $value) {
        $value = urlencode(stripslashes($value));
        $value = preg_replace('/(.*[^%^0^D])(%0A)(.*)/i','${1}%0D%0A${3}',$value);// IPN fix
        $req .= "&$key=$value";
    }

    // assign posted variables to local variables
    $data['item_name']          = $_POST['item_name'];
    $data['item_number']        = $_POST['item_number'];
    $data['payment_status']     = $_POST['payment_status'];
    $data['payment_amount']     = $_POST['mc_gross'];
    $data['payment_currency']   = $_POST['mc_currency'];
    $data['txn_id']             = $_POST['txn_id'];
    $data['receiver_email']     = $_POST['receiver_email'];
    $data['payer_email']        = $_POST['payer_email'];
    $data['custom']             = $_POST['custom'];

    // post back to PayPal system to validate
    $header = "POST /cgi-bin/webscr HTTP/1.0\r\n";
    $header .= "Content-Type: application/x-www-form-urlencoded\r\n";
    $header .= "Content-Length: " . strlen($req) . "\r\n\r\n";

    $fp = fsockopen ('ssl://www.sandbox.paypal.com', 443, $errno, $errstr, 30);

    if (!$fp) {
        // HTTP ERROR
    } else {
                mail('ash@evoluted.net', '0', '0');
        fputs ($fp, $header . $req);
        while (!feof($fp)) {
            $res = fgets ($fp, 1024);
            if (strcmp ($res, "VERIFIED") == 0) {

                // Validate payment (Check unique txnid & correct price)
                $valid_txnid = check_txnid($data['txn_id']);
                $valid_price = check_price($data['payment_amount'], $data['item_number']);
                // PAYMENT VALIDATED & VERIFIED!
                if($valid_txnid && $valid_price){
                    $orderid = updatePayments($data);
                    if($orderid){
                        // Payment has been made & successfully inserted into the Database
                    }else{
                        // Error inserting into DB
                        // E-mail admin or alert user
                    }
                }else{
                    // Payment made but data has been changed
                    // E-mail admin or alert user
                }

            }else if (strcmp ($res, "INVALID") == 0) {

                // PAYMENT INVALID & INVESTIGATE MANUALY!
                // E-mail admin or alert user
            }
        }
    fclose ($fp);
    }
}

Step 5 – Functions.php

The payments.php page calls upon a number of functions used to validate the returned data and store the response in the database.

// functions.php
function check_txnid($tnxid){
    global $link;
    return true;
    $valid_txnid = true;
    //get result set
    $sql = mysql_query("SELECT * FROM `payments` WHERE txnid = '$tnxid'", $link);
    if($row = mysql_fetch_array($sql)) {
        $valid_txnid = false;
    }
    return $valid_txnid;
}

function check_price($price, $id){
    $valid_price = false;
    /*
    you could use the below to check whether the correct price has been paid for the product
    if so uncomment the below code

    $sql = mysql_query("SELECT amount FROM `products` WHERE id = '$id'");
    if (mysql_numrows($sql) != 0) {
        while ($row = mysql_fetch_array($sql)) {
            $num = (float)$row['amount'];
            if($num == $price){
                $valid_price = true;
            }
        }
    }
    return $valid_price;
    */
    return true;
}

function updatePayments($data){
    global $link;
    if(is_array($data)){
        $sql = mysql_query("INSERT INTO `payments` (txnid, payment_amount, payment_status, itemid, createdtime) VALUES (
                '".$data['txn_id']."' ,
                '".$data['payment_amount']."' ,
                '".$data['payment_status']."' ,
                '".$data['item_number']."' ,
                '".date("Y-m-d H:i:s")."'
                )", $link);
    return mysql_insert_id($link);
    }
}

Step 6 – Setting Up The Payments Table

To store payment details in the database a payments table must be created in your database. The following MYSQL code will create a payments table.

CREATE TABLE IF NOT EXISTS `payments` (
  `id` int(6) NOT NULL AUTO_INCREMENT,
  `txnid` varchar(20) NOT NULL,
  `payment_amount` decimal(7,2) NOT NULL,
  `payment_status` varchar(25) NOT NULL,
  `itemid` varchar(25) NOT NULL,
  `createdtime` datetime NOT NULL,
  PRIMARY KEY (`id`)
) ENGINE=MyISAM DEFAULT CHARSET=latin1 AUTO_INCREMENT=1 ;

Step 7 – Sandbox Testing / Going Live

PayPal Sandbox offers all of the functionality of PayPal, but the information involves all “Fake accounts” created by the developer. You can create fake buyer and fake seller profiles, then test your PayPal integration through your development website.

During the testing phase of the development process the PayPal links should be prefixed to www.sandbox.paypal.com. You can visit the PayPal Developer website and sign up for a free PayPal Sandbox account

Once the payment process is ready to be used by real customers you will need to remove the sandbox from each PayPal link to www.paypal.com.

That’s it; you’re ready to start taking payments online through your website.

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