posted on October 3, 2000 10:24:36 AM new"We intend to keep PayPal free for personal transactions, but in order to do this we cannot provide unlimited credit card processing for all users. That's why we are asking the users who benefit most from PayPal to upgrade to a Premier or Business Account."
Okay. Done! But again, they are saying it is Credit Card Transactions. No Problem. I will pay the fees as they are set up for those.
But then, you go to the web site and they are charging for non CC transactions and THAT is NOT all right!
I see the ramp narrowing and narrowing, with more little nibbles here and there until we are like the rabbit caught in the trap...
posted on October 3, 2000 10:49:21 AM new
Last week I started adding in the line that I do not accept PayPal because I can't afford to pay the extra fees. And I can't. But just because I'm not a high roller like some here are, doesn't mean I'm not sufficiently profitable, or that my "ebay bussiness plan is poorly thought out". I sell books. Some do very well. Some make only a small profit. I can't support my family on it, I'm not trying to. But whatever I make is more than I had before I started selling, and it works for me.
I did not notice that banning PayPal affected the final bid price of my auctions.
Those that have contacted me about it, I refered here. Quite a few people are still unaware that PalPal is no longer free.
posted on October 3, 2000 10:50:20 AM new
To Haddo-
Do you really believe that PayPal's "original" business plan and intent was to have people leave significant amounts of money interest free with PayPal for extended periods of time ? Not on this planet.
PayPal also has a mandatory 3-5 day float regardless of when the member wants to take the money out. By the way, money funds loan money for periods as short as overnight to banks and others at fat fees.
PayPal operated just like the heroin dealer alluded to earlier.
posted on October 3, 2000 10:51:27 AM new
I like the heroin comparison. They draw you into the web as free and clear of hassles, just to help YOU out.
Yeah. Right. Been there, done that. I am a small seller but if the 19.00+ that Amy worked out is true, that's a total rip. What a game. And the best part, my email at the bottom says "All of this will be completed by Halloween"
BOO!
posted on October 3, 2000 11:24:19 AM new
I think that was sneaky to carefully omit the rest of their charges from the email. I was really fooled, because I thought they were being very fair and straightforward. Thanks so much to the people on this message board that researched and shared the rest of the information with us!!
So now I really want to postpone upgrading, because once I do ALL my paypal transactions will be charged a fee?? That seems so odd, I wonder if they just haven't updated their TOS to reflect the new policy. It doesn't coincide with their explanation in the email about credit card charges. AND at 1.9% under $15, the bank account transfers are MORE than credit card charges. Am I missing something? This has to be an error in their TOS, doesn't it? Anyone asked Paypal directly about this?
Meanwhile, I'm on my way to PayDirect. I don't think it will take long for them to become more popular. Do they accept AmEx? I know Exchange Path does, and from putting Exchange path in my ads, I've had 2-3 referrals and payments that way.
posted on October 3, 2000 12:04:03 PM new
julieDc I have been using paydirect now for a few weeks and it seems to be going well.
I simply tell the people in my E-mail that Paypal went to a charge system and this lets me keep my costs down for them to use paydirect. They don't even question it I just get a letter from paydirect that they have paid. Even if I could afford to paypal the paypal fees why should I when I can get the same thing free) Actually I like Paydirect better (did take a little getting used to slightly different in function) Paypal changes the rules ever ten minutes and they are now what I see as a bunch of goofs that just got lucky Paydirect has a real professional feel to it unlike Paypal that always seems to be fumbling around Paydirect planned out ahead of time what they were doing)
Here is what I put in the e-mail
Visa Master Card taken by Yahoo! PayDirect a service that lets you send or receive money online from an account you fund with your credit card or checking account(free service). Yahoo paydirect link goes here hear. (Paypal is no longer free to sellers (starting October 1st) and I don't want to pass on the extra cost as paypal had suggest to some sellers, so I am trying PayDirect a free service)
Here is what I put in my auctions and it seems to be working without a hitch. The buyers will follow where the sellers go if they know it is also to their benefit.
Here is what I put in the auction Pay <U>ONLINE with PAYDIRECT </U>. (the one on Ebay I just use the banner for paydirect. On Yahoo I use the banner and the link directly to Paydirect. Visa and Master Card taken by PayDirect a service that lets you send or receive money online safely from an account you fund with your credit card or checking account (free secured service). Link to be sent along in winning bid E-mail. (the last line I only use for Ebay as I don't want to put in a link to yahoo paydirect because I am not sure if Ebay would allow it.)
It seems to be working most of my sales are paid through paydirect now both on Ebay and Yahoo. I expected a little drop in sales at first thinking people that only pay via paypal but not drop in sales and the one that only pay through an online service (some of my regulars) have had no problem with the switch. One prefers it now and pays that way when he can.
So, in answer to your question that is what I have done. The banners help a great deal I think with the switch over. You can find them here on the Yahoo Message board under the Paydirect Banner thread.
posted on October 3, 2000 12:19:06 PM new
--------------------------------------------------------------------------------
I also can't see having them charge us when the buyer is using his PayPal balance. I can justify it if they are using a credit card though.>>
When I used paypal I never paid via credit card. I just used money that was in the account. How are they paypal the most unorganized and unprofessional, don't know what they are doing ever going to know what kind of payment came from where? They could make a lot of money on those fees that will be charged on transcations that don't use Visa. I am all for paypal and others making a FAIR and good profit, but it seems to me the owner of paypal just wants to make money off others sweat and look like a good guy when he is really a blood sucking leach like most businesses and politcal systems are. Hmm now did I saying that with enough empahsis. I would want anyone to think that I actually am naive enough to think Paypal is being fair, business is not about fair.
posted on October 3, 2000 05:02:14 PM new
Hello Haddo,
Sorry - charging extra for method of payment is against Ebay TOS from what I understand.
Also from what I can see at PayPal's site, they are not just charging for CC credits, but all money transfers. Considering that it costs PayPal nothing to do that, the charge seems a bit steep. Can you imagine getting 1.9 percent for each computer transaction's total when it just changing numbers on a database? It would be like Ebay getting 2 percent off the current bid price for every item each person just looked at.
I'm also rather disgusted that they implied in their policy change notice that business accounts would only be charged for credit card payments and that you have to dig it out of several layers of menus on their web page to find the real fees. It's just getting to be too hard to trust their intentions. Too many of these 'badly worded notificiations' seem to be to their extreme advantage.
posted on October 3, 2000 05:35:15 PM new
no where in there letter does it say they will charge accounts if the buyer pays with funds from there paypal account or there bank account.
here is what it does say.
the fees are low - just $0.25 for credit card payments under
$15, and $0.25 + 1.9% on payments over $15.
and how to hold the account under the $500 limit on credit card payments money paid from a buyer bank or paypal funds wont count toward the $500 linit they will provide a counter to keep you up to date on how much in CC payments you have received.
They also say you can reqest buyers pay from there bank or paypal balances as well.
I think Paypal has done pretty well in out lineing it this time.
posted on October 3, 2000 05:55:32 PM new
So I guess the thing to do is to keep a personal PayPal account for the bank account/balance transactions and to find some other service for credit card transactions. Just imblazone "PAYPAL NO LONGER ACCEPTED FOR CREDIT CARD TRANSACTIONS - PLEASE USE BILLPOINT OR PAYDIRECT INSTEAD" on your auctions. That way all you have to pay for is the credit card transactions and 2.25 isn't much more than 1.9 percent - certainly not enough to make me want to pay for other transactions.
You might even put a bottom limit on CC transactions, like the stores sometimes do. Might give customers an incentive to try to win several auctions.
I have lots of repeat customers and I have no problem waiting a week or so, so they can consolidate payments. They usually do anyway.
posted on October 4, 2000 12:47:08 AM new
Just don't accept "credit card" payments through PayPal. You could request that PayPal users use debit and balance payments only. This way you would not have to upgrade.
posted on October 4, 2000 01:44:04 PM new
Not that it matters anymore since I no longer
accept PayPal, but bringing in $500 every
six months (gross no less, not NET), makes me a business? If that's the case, I'd be the worst businessperson in history! Get a clue PayPal - we still are not getting an honest answer and that is that you never had any intention of keeping this free. If you didnt anticipate that taking credit cards would cost money, then you are even worse business people than us little "$500 in six monthers are".
posted on October 4, 2000 04:54:43 PM new
Maybe I am tired (and I don't feel like reading the PayPal letter again right now) but the way I interpreted it was that fees would be charged for credit card transactions only, not for payments made from the buyers debit card or from the buyers PayPal account. Am I right or wrong ?
posted on October 4, 2000 06:24:31 PM new
reddogsma
"buy the way I interpreted it was that fees would be charged for credit card transactions only, not for payments made from the buyers debit card or from the buyers PayPal account."
I think that is the way they intended you to interpret it. Pretty slick!
posted on October 4, 2000 11:10:55 PM new
from haddo above: "For those of you that are operating on a small profit margin, and have difficulties absorbing the CC cost, you might want to include it in your TOS. In your TOS you can mention that there is a 2% charge for CC payments, this covers the 1.9% + the $0.25."
If I'm remembering correctly, eBay prohibits surcharges on credit card payments. Such a prohibition grows out of the fact that surcharges are prohibited by the contract a merchant signs with his/her card processing service. The situation with PayPal (or BillPoint or any other on-line service such as PayPal) presents an interesting situation, though, because the person levying the surcharge doesn't have a contract with the processing company.
I agree with an earlier post, though, that there's something wrong with the basic business plan if credit card charges push a seller over the brink. It's a standard cost of doing business, and if done through PayPal, the cost is far lower than most small business "store-front" owners pay, typically 2.5%-4%, with or without a per-transaction charge, plus equipment costs. Also, consider that a strictly on-line seller is not paying some or all of the costs here:
*Commercial rent (say a minimum of $1000/mo)
*Liability insurance (required by landlords (say $40-60/mo)
*Security costs (burglar alarm ($30-60/mo)
*Commercial phone costs (an extra $20-30/mo)
*Yellow Page advertising (you don't want to know! At least $60/mo, sky's the limit)
*Display costs - cases, lighting, props, more . . . $$$$$$$$
*Relocation costs when your lease is up and rent increase 25% or whatever. Our relocation last year probably cost us 4 or 5 thousand dollars.
Another thing, IMHO, credit card costs should be looked at as a percentage of your total annual sales, not as a percentage of a particular item's price. Credit cards are a service you offer all of your customers.
That aside, it still irritates the hell out of my how much the card companies charge, so I'm no great admirer, fer sure!
Edited to fix UBB list code that didn't work.
[ edited by Islander on Oct 4, 2000 11:13 PM ]
[ edited by Islander on Oct 4, 2000 11:18 PM ]
[ edited by Islander on Oct 4, 2000 11:21 PM ]
posted on October 5, 2000 04:38:48 AM new
Islander: Many sellers don't compare themselvers to storefront businesses at all because the nature of the auction. Unless you start your auction at the selling price you must have, then I am not in control of the ending price. If I was, I would use the 100% mark-up rule and double the cost of my item. Then I could easily eat the cost of credit cards, and other miscellaneous costs. But for some reason, at least in my case, the items do not sell if you start them high, but they'll sell for higher if you start them low. Just one of those freaky psychogical auction quirks. I've seen widgets that regularly sell for $28 on Ebay sit there with no bids and a start price of $24.99. And listed below it is an EXACT widget about to close for $32 that had a start price of $.99. The profit on these widgets is around $8, not a huge amount, but enough for a stay at home mom like me to supplement her family's income without having to pay for day care.
My point is that you just cannot compare many of us sellers that way, and these types of sellers will probably not shut down their businesses because of the credit card fees. I think/hope that we will find creative ways to stay profitable: passing on the fees to customers, or taking pay methods besides Paypal, or even eventually back to snail mail if we have to. Whether or not some of us can get away with this will depend on our competition. If there are MANY sellers that do not accept credit cards, than buyers won't think it's a big deal and will use snail mail. Or if it is common to pay a fee for using pay services (or rather, receive a "cash" discount for NOT using them), then customers will be used to it and not SKIP my auction. The buyers show us that now: how many auctions offer identical items with different s/h charges? There is a percentage of savvy buyers that carefully choose who they are bidding with based on fees/policies etc. But I don't think the majority of our buyers spend that much time researching.
posted on October 5, 2000 05:51:10 AM new
Before PayPal, those sellers who felt that they could afford a merchant account had one. If they were a storefront business or a larger business, they had merchant accounts.
PayPal and like services are targeted at the smaller seller who is just "clearing clutter" or who has a smaller profit margin who never felt that they could swallow the cost of a merchant account on top of all of the other expenses involved in selling.
And remember that Ebay was also founded on the principle of the person-to-person, garage sale/flea market type person as well.
These are the sellers who are targeted to grow these companies and then these companies want more more more.
I don't know about you, but I am selling things to give me some extra money, not to support every outfit out there who wants a quarter plus a percentage from each of my auctions. Small changes are quite large when you are selling low end items (which are what made Ebay what it is today.)
posted on October 5, 2000 06:01:49 AM new
I think a lot of people are going to start singing a new song when they actually have to start paying.
Sell something heavy? You're going to be paying commission on the postage, which is also going up btw. We learned this a year ago when selling on Amazon with their 1-click. Worked like a dream but in the end it was just to big a bite. They would show an accounting of fees separately (Amazon's and 1-click's) but when you put the two together it was very clear that it was time to find the door.
posted on October 5, 2000 06:12:04 AM new
Excellent point VM.
Also, there are a lot of people out there that think that what was in the letter was the WHOLE fee schedule and have not seen the entire fee schedule that has been set out by PP which you must ferret out of their web site.
This will also make for a rude awakening!
BTW, when I signed into PP last evening to do some maintenance on my account, I got a pop-up letter that was the same as the e-mail and at the bottom of which were 4 buttons to choose from. Upgrade to Premiere, Upgrade to Business, Already upgraded or Keep my personal account.
posted on October 5, 2000 08:56:42 AM new
Just had a thought......The folks that upgraded are the ones getting the shaft. Upgrade and you lose your "Free Fees" on $1,000 per year.
Sounds good to me. Feed and support paypal and get screwed. And then get on these boards and say how wonderful paypal is. LOL!!
posted on October 5, 2000 09:12:55 AM new
heygrape
That makes no sense - what is one suppose to do after they run through the $1000 FREE?
We've gotten our "free" times over, and have now upgraded. I don't mind at all letting PayPal handle the paper work, keep the records, and save us tons of phone calls from customers with their charge numbers. We have our own merchant account, but PayPal costs less, and with their handling of the paperwork, records, etc., it actually saves us money.
PayPal is doing me a big favor, saving me money, and acting as an on line secretary, too.
posted on October 5, 2000 09:36:01 AM new
Makes plain sense to me. If you do not upgrade you can accept up to $500 every 6 months with no fees. If you do upgrade you pay fees on that $500 accepted every 6 months. Why doesn't that compute?
posted on October 5, 2000 09:45:09 AM new
TheRedCircle took the words right out of my mouth!! Right on the money with this statement. >>>Either way, it's really too bad...the fees are rather fair for credit card processing, but I have absolutely no confidence in the company anymore, considering the many multi-faceted turnarounds both Paypal and x.com have been pulling the past few months.
Cheap is one thing...credibility is another. Paypal has a bit of the former and absolutely NONE of the other.
