Free web hosting Facilities
It's for free. You don't need to pay for domain name.

Free web hosting Limitations
Your URL will be something like http://www.sampleaddress.com or http://www.sampleaddress.com/merchant . As I noticed above, the advantage is that you don't need to pay for domain. But note that if you move your website to another provider in the future you can loose some or all your traffic.
Your provider will probably include ads to your pages - usually 1 or 2 banners, sometimes popup windows. If you plan to use banner exchange on your site read carefully their Terms and conditions. Some free hosts doesn't allow it.
Free hosts usually allow lower bandwith then paid hosts and a lot of them don't offer futures like PHP and MySQL.
A lot of free hosts change their Terms and conditions during some time. If your free host offers hosting without ads now, don't be surprised when banner or popup appears on your site in the future.

Paid web hosting Facilities
You can host your own domain. If you decide to change the web hosting provider in the future, you easily transfer the domain to the new provider and don't loose your traffic.
Most paid hosts offer 24/7 support via email or live chat and some of them provide toll-free phone support.
You can expect better uptime then on free host. Some paid hosts offer uptime guarantee.
Paid hosts usually offer enough disk space and bandwith. Futures like PHP and MySQL are standard. Even if you are not programmer you can download plenty of free PHP scripts from internet.