If the payment method "Credit card & " is indicated as "Limited to $500", this means that your account has not been fully validated.
You've probably received an e-mail telling you this (remember to check your SPAMS): you need to provide more information in your PayPal account to lift this limit. This additional information may include: a bank card for withdrawing money if required, a bank account to be credited if required, identification for additional checks...
Don't delay: once you've provided this additional information, PayPal will lift the limit within 72 hours, allowing you to receive unlimited card payments.
Before this limit is lifted, you will not be able to withdraw or transfer money from your account. You can only credit your PayPal account with customer payments.
If you receive more than $500 card orders, the card payment method will be deactivated until your account has been fully validated.
In the meantime, you can still receive payments via PayPal without limit.