posted on October 29, 2000 03:30:00 PM
With all the threads lately about the direct passing on of PayPal & BillPoint fees (by direct, I mean where it's STATED in the TOS that an additional fee is being charged for the customer to use PP or BP), I decided to ask ebay directly for their response.
I asked them if the DIRECT passing on of PayPal or BillPoint fees (again, by directly mentioning them in a person's TOS) was allowed.
Here is their direct response I received today:
"Hello,
Thank you for writing eBay.
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, where eBay's servers reside.
Both Paypal and Billpoint do not allow their members to charge their
fees back to a winning bidder. You can review this information at the
following URL:
As an alternative to the credit card surcharge, you may offer a discount
to buyers who pay by money order or check. If you would like to use
this option, the discount would have to be taken off the winning bid
price after the auction closes. This way, the bidder is not charged any
additional fees. "
Now, I realize people are going to do what they want to do & we all know that 2 of us can write ebay at the same time & get 2 wildly different opinions depending on who responds to the email, but I found this response quite interesting & thought I would pass it along to everyone.
It seems the "safest" approach would be to just build any additional cost of PP/BP into either your starting cost or handling fee & don't mention it directly.
posted on October 30, 2000 08:19:13 AM
I was just looking over PayPal's TOU page. I especially like the last item:
This Agreement is subject to change at any time without notice, and you agree to review the current terms of use prior to initiating a transaction.
Bold added...
Review the TOU prior to initiating a transaction? Every transaction? Yeah, right... that'll happen. Bidder wins auction, receives email from seller with total due, bops on over to PayPal TOU page and spends 10 minutes reading it (how do you know if there is a change since the last time you looked, anyway?), sends money to seller.
Nothing like a TOU which guarantees that every user is in non-compliance.
posted on October 30, 2000 10:05:09 AM
I sent SafeHarbor an email asking the same basic question about passing on the fees. The reply that I got was that it was ok as far as eBay is concerned but to check with PayPal to make sure it isn't against their rules.
I guess eBay's strategy is to give so many differing opinions that the issue is completely muddled. That way everyone will be afraid to try it.
posted on October 30, 2000 10:16:59 AM
I must have missed it when my eyes glazed over while reading PayPal's TOU but I can't find any reference about not being able to pass on the credit card fees to your customer. Can someone point me in the right direction?
posted on October 30, 2000 10:33:09 AMI must have missed it when my eyes glazed over while reading PayPal's TOU but I can't find any reference about not being able to pass on the credit card fees to your customer. Can someone point me in the right direction?
This is the whole point! By passing on PayPal fees, you're not passing on credit card fees, you're passing on fees that PayPal charges for performing a service. If PayPal (the merchant) passed credit card fees on to us, they would be in blatant violation of their merchant account agreement and any applicable laws. That's why PayPal charges for all transactions even if they aren't funded with a credit card. To do otherwise would put them in very hot water.
PayPal is the merchant. They charge the user's credit card. Their name shows up on the user's credit card bill. PayPal's customers do not accept credit card payments. You cannot accept credit card payments without a merchant account. Your PayPal account is not a merchant account. Therefore, it is impossible for you to accept credit cards through PayPal. Instead, you are accepting cash from an on-line payment service. This is no different from going to Western Union and collecting cash that someone sent to you by charging it to their credit card. Yes, the customer "paid" with a credit card. But Western Union is the merchant. They hold the merchant account.
