You can process payments in WooCommerce with PayPal using only the account email. However, in order to refund payments from within WooCommerce you must enter your PayPal API credentials.
Here are the steps for doing that:
- Login to PayPal
- Go to Profile > Profile and Settings
- Click My Selling Tools
- Go to API Access
- Select NVP/SOAP API integration
- Click to view API Username, Password and Signature
- Add information into WooCommerce PayPal settings
I find it much easier to refund payment directly from within WooCommerce and not need to login to PayPal to refund manually in addition to from within WooCommerce as well.