posted on October 23, 2000 03:40:41 AM new
ok
I tried an experiment
I started adding this to my invoices last week
"..> you can send me a check, cash, moneyorder, or use Bidpay,
> ExchangePath, or Paydirect...
>
> If you want to use PAYPAL read below........
> Paypal is now charging me .25 cents for each transaction plus 1.9% So if you
> use Paypal you must add .75 cents to your total ... "
I have sent out around 100 invoices with this at the bottom ..
the results so far are .....
0 paid with paydirect
2 paid wih Bidpay
2 paid with exchange path
19 paid with paypal 18 of which added the .75 cents
0 complaints so far
1 person asked what was going on as he was a seller and did not know of the charges -- I sent him to paypal's policy and also to here -- he emailed back saying he would pay with paypal and he added the 75cents.
2 people emailed saying I was not the only one passing along these costs - but that they would continue to use paypal because it was still cheaper and easier.
11 of the paypal payments were less then 15.00 and 8 were over 15.00 but none were over 33.00........
I decide on using a flat charge to make it easier on me and my buyers.
as most payments made to me fall into the 10-50 dollar range, this amount on average will cover the paypal costs.
So I guess when I hit 500.00 ( this week prolly ) then I will upgrade...
has anyone else tried something like this ??
P.S I am sending back the 75 cents to ALL my buyers until I am verified, with a note explaining it all to them.
posted on October 23, 2000 05:58:09 AM new
Did I read this right You lied to them about a fee then returned the fee? Uh....I hope no one reports you to safeharbor
posted on October 23, 2000 06:21:21 AM new
For most (former) paypal users here, the issue isn't the measly 1.9%, which I would have gladly absorbed rather than pass on to my customers (as I do for my billpoint users).
The larger picture was that paypal demanded my permission (via "verification" ) to take money out of my checking account at their discretion with no previous warning or due process of any sort.
That's just one reason at the top of a long list, none of which have anything to do with fees.
Why don't you inform your buyers of these facts? I have and do. My customers were clueless that they had given paypal the keys to their accounts when they verified. My results were quite different from yours. Most buyers closed their accounts and used billpoint.
posted on October 23, 2000 07:32:28 AM new
The fee is a standard fee that all businesses pay when they accept credit cards or debit cards. It's the cost of doing business and the retailer absorbs the fee. Nothing new, that's what happens every time you put your credit card on the counter where and whenever you shop.
I couldn't abide PayPal getting into my checking account at a cost to me from my bank of $25.00 per tap. That's why I couldn't verify.
PayPal allows me to do business with a lot of people I wouldn't be able to otherwise. My regular merchant account charges an extra fee when I hand key in the card account number, with PayPal I'm covered. Most merchant accounts don't want to service businesses that do internet, phone or mail order. They want the buyer to slide the card and sign at the same time.
posted on October 23, 2000 07:48:48 AM new
The standard fee for using an atm for a merchant I believe is nothing. PayPal charges 1.9 percent for bank and PayPal balance transferrals. PayPal's credit card fees are outrageous when you add in those charges.
posted on October 23, 2000 08:38:38 AM new
Just a note that in California, it is illegal to pass on any credit card fees to the buyer. Now in the case of Paypal, since they are charging the fees regardless of how the buyer pays, then you may be okay.
**********************
That's Flunky Gerbiltush to you!
posted on October 23, 2000 08:58:57 AM new
Also, it's illegal per our credit card agreement (conventional), to charge a handling fee on top of the fees already established. It's also illegal-against your contract on conventional charge card transactions to request a minimum charge. Just think, what if you needed emergency supplies and a drugstore or otherwise refused you....here comes my lawyer!...
posted on October 23, 2000 11:22:03 AM new
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posted on October 23, 2000 11:33:10 AM new
Although I don't intend to pass on the paypal fees, I can't see where it is illegal.
I haven't signed a contract for a merchants account with a credit card company. Paypal is the one with the merchant account. They are the ones who signed the contract. It is illegal for them to pass the fees on to the credit card holder. (which is why it will "always be free" to the buyer)
If I pass on fees, I am passing on the fees that paypal charges me for the use of their service. The fees I pay them are for the service of money transfer, not for accepting a credit card...remember, they are charging us for ALL money transfers so the fees are not credit card fees.
posted on October 23, 2000 12:45:59 PM new
Ebay was asked this question about Paypal and the answer was that it was not against their TOS but it looked sleazy. In any case, what you do is state that there is a 2% handling fee but you will give a 2% discount if paid with anything except paypal. http://www.ygoodman.com [email protected]
posted on October 23, 2000 01:02:10 PM new
http://pages.ebay.com/help/community/png-list.html
"Credit Card Surcharges
An eBay seller may not charge a fee, often called a "credit card surcharge," when accepting credit card payments. This surcharge, which is an added cost to the buyer over and above the final sale price and shipping/handling, is not allowed under the laws of many states, including California...."
It says nothing about electronic funds transfer surcharges. Of course ebay can just pull one of their the rules are what we say they are tricks.
The legal term for what paypal and ebay billpoint does is factoring. It used to be that Visa/MC prohibited factoring in no uncertain terms. It was a major violation to accept a credit card on behalf of another merchant and to charge that merchant a fee for factoring. They used to send merchant flyers warning that you could lose your merchant account and be subject to a host of criminal charges for factoring (fraud, money laundering, etc.)
posted on October 23, 2000 01:03:46 PM new
When I started out on ebay I had my own credit card machine. I am assessed fees for it by the credit cards companies. I was charging the percentage that the cards charged me to use it. I received a call from ebay telling me that in California (ebay's home state)it is illegal to add on a credit card usage fee.
If I did not remove it from my auctions I would be suspended from ebay. I of course removed it.
I believe what you are doing WHITEMIST is grounds for suspension.
posted on October 23, 2000 01:59:08 PM new
MsStone... how exactly did you come to the conclusion? Whitemist is not accepting credit cards, he is accepting an electronic fund transfer. I posted ebay language just about you post, and its says that sellers who accept credit cards can't surcharge, it doesn't reference EFT's.
posted on October 23, 2000 02:05:33 PM new
I've been involved with a few threads on merchant agreements on the usenet group misc.consumers and the feeling there from consumers is that Visa/MC doesn't take action against vendors who get reported to them for surcharges or minimum purchase requirements.
The only time I saw a merchant actually change a policy of surcharges was when I kept doing chargebacks of $0.50 when ever they charged me a $0.50 surcharge when I used my card for a video rental.
posted on October 23, 2000 02:36:55 PM new
Whitmist: I would like to requalify my statement. I am only going on what ebay told me at a time when pay pal and the others did not exist.
I find the whole thing with pay pal, Especially their "always free to you statment" wondering if it is worth it?
posted on October 23, 2000 02:46:44 PM new
irenefleet - you might be better off with ProPay I have been using them 3 to 6 times a week and they have been very good. Do foreign with no trouble and have good customer service.
posted on October 23, 2000 02:55:12 PM new
I think one the electronic payment industry shakes out, and we left with 2-3 players (who will probably be bough up by Visa/MC, Amex, and Discover) it will be just like merchant accounts, and most hobbyists sellers will retreat from using them and/or will be locked out of the market just they are with traditional merchant accounts.
Right now, we have about a dozen players who would pimp their own daughters for market share, and the hobbyist sellers will be hoping around from one to another as long as they are free or tossing money at us.
Consumers can't deal with two many choices, and ETF just like political parties, TV networks, credit cards, etc.) will generally be limited by market selection to two big players, and another 2-3 also rans.
posted on October 23, 2000 04:06:58 PM new
I don't like the idea that as a buyer, I could sign up with a dozen different services to pay for auctions. Don't think I want my information out to so many different places.
And if I see a charge for paypal or any other service, I will not bid. Would it be okay to deduct the cost of a stamp if I decide to pay by check or money order?
Fees are a part of doing business. And if you are selling on the internet, no matter whether you consider yourself a "hobbyist" or "small time" or whatever, you are conducting business the moment you list an auction, pay ebay fees, and accept payments.
posted on October 23, 2000 04:30:03 PM new
these extra fees some are chargeing for useing paypal are not illegal in cal ebay is in that state they must live up to these laws
EBAYS TOS it self say these fees are not legal in most state INCLUDEING CALIFORNIA.
I to read what was said on ebay boards they were right in saying the fees look sleezy and would be better if you offer a 2% dicount to pay with check or money order.
But they were WRong when they said it wasnt against ebay TOS.
NO matter if paypal is the merchant if some one uses a credit card to pay you through paypal and you charge them a fee they are still being charged a fee there Credit card agreement says they can not be charged.
WWW.dman-n-company.com
posted on October 23, 2000 04:32:42 PM new
Many sellers want it their way only. They want to collect monies, not pay taxes, charge the buyers, and then say it;s a hobby. This is not a level playing field when the word competetion comes into mind. I agree, as a seller, I do not see a reason to pass along fees that can be deducted if one were paying taxes on the income in the first place. That option is available.
posted on October 23, 2000 04:44:24 PM newWould it be okay to deduct the cost of a stamp if I decide to pay by check or money order?
Item sells for $10.00, shipping included- buyer has two options:
Send money order- $10.00 + $0.50 for money order + $0.33 for stamp (I'll throw in the envelope for free) = $10.83 (and get item in 10 to 14 days, maybe), and buyers find this acceptable.
Pay through PayPal- $10.00 + $0.25 PayPal fee = $10.25 (and get item in 5 to 7 days, maybe), and buyers scream bloody murder.
What's wrong with this picture? If you're going to complain about paying the cost of getting your payment to the seller through PayPal, why haven't you been complaining about having to buy money orders/stamps/envelopes/etc. all along?
posted on October 23, 2000 05:48:42 PM new
The response I've got from ebay concerning discounts for forms of payment, multiple purchases, etc., is that ebay considers this to be a "promotion", and you can be legitimately reported to safe harbor for doing this. You can accept any form of payment or have any charges you want, but the payment policies and charges have to apply to anyone who wins that auction. You also can't offer extra perks (i.e. promotions) if bidding reaches a certain level.
So, I could say, "shipping is free", but I couldn't say "shipping is free with paypal", or "shipping is free if bidding reaches $40". And I couldn't offer a discount for using a particular form of payment, because that would be "promoting" that form of payment over others.
IMO, sellers should consider all their costs (listing fees, paypal fees, bubble wrap, boxes, etc.) as operating expenses and figure it into the cost of the item when deciding the minimum bid. If the item cost you $10, figure a 50 cent listing fee, at least a 20 cent FVF, and 35 cent paypal fee, and just start the bidding at $11 to cover your costs.
posted on October 23, 2000 06:11:46 PM newEmpires-
Please explain your point.
My point is simple.
With regards to a buyer's fee for using PayPal, you said:
I do not see a reason to pass along fees that can be deducted if one were paying taxes on the income in the first place.
If you reimbursed the buyer for the cost of a money order and a stamp, you could just as easily deduct this cost too (in fact, you can deduct this cost regardless of whether or not you reimburse the buyer), yet you claim not to do so.
posted on October 23, 2000 06:44:59 PM new
By law you cannot charge the consumer your processing fee. You can of course up the price of your goods reflecting what all, an avg of .75 cents. You can add it as a handling fee, making whatall your $3.20 into $3.95.
I have no idea how applicable this is to paypal. Understand, your not the seller as far as the charge is concerned. They are. I'd imagine it'd be a good idea for anyone to print all transaction reciepts from PayPal as if you get an audit and dont have it your going to pay for it.
Signed: WhyNot!
