Sadly PayPal is the dominate payment processor at the moment online (this is why they act like dicks) but there are many alternatives. I would recommend getting a proper merchant account or using your banks transfer systems if you can or a pigeon, dolphin, donkey what ever it has to be better.
More and more stores are accepting Google payments so I would see if thats a option, or maybe obtaining a prepaid debit card?
7 Great Alternatives to PayPal :
Nochex (UK based) :
PayLoadz seems to specialize in digital online sales :