You sign up with a user name and password- when someone pays you they use either your user name or email address- it goes into your account automatically when they pay you, Paypal notifies you when a payment comes through.
You then have the option to withdraw placing the funds either directly into your bank account (of course they need that info on record to do this when you sign up they will ask all that info if you choose to give it). Or they will assign you a check that will be delivered to your address.
If paying someone by paypal, the info (credit card or bank account) would be used to pay a person, paypal will take funds from whichever account (bank or credit card) you have on file and choose, and the person is paid. When using a bank account like your checking account, the check takes a few days to clear so you as the buyer will not get immediate shipment as you would if paying by credit card or funds already in your account (a balance that you have not withdrawn from being paid by buyers) same if you are a seller, if they pay by check it will state as such and you wait until the check clears before shipping their item. With this you get a notification from paypal that funds have cleared.
It sounds more confusing than it actually is, if you can balance a check book or keep track of one, you can do paypal.