The easiest and fastest way to raise money online for free with PayPal is to use an online fundraising site. Because of the high amount of funds that are generated through fundraising sites, PayPal allows them to transfer funds at very low rates. Since PayPal does take a percentage of all funds transferred, it is important to find out how much the PayPal fee is, and if there are any hidden site fees.
To set up a personal fundraising site that allows you to raise funds via PayPal, check out YouCaring.com. They offer the only truly free fundraising accounts and have a very minimal PayPal fee. You can create an account with PayPal easily while creating your free online fundraising page. Go here for more fundraising tips.