posted on November 13, 2000 01:44:51 PM
Hi all. I was recently contacted by a seller for an auction I won, and in addition to the final bid fee, postage (which was inflated from actual cost), I was advised that if I wish to pay via Paypal, I will have to pay the additional charge accessed to paypal business accounts. This is the actual verbiage used "If you would like to pay with Pay Pals you will need to include the fee charged to business accounts. If you need assistance with calculating this
fee please let me know."
I was wondering if this is a common practice. I, too, use Paypal, and have sold things, but while I have a personal account, I have never thought of passing on this charge. I use stamps.com. Stamps.com charges me 10% for printed postage. I would never advise a bidder they have to pay this additional charge. If I feel I need to recoup it, I just add it into the postage as stated on my auction. Seems to me to be a cost of doing business for her, so she can collect her money sooner.
I'm looking for suggestions on how I should handle this, as I would like to use Paypal, because of its ease of use. Thanks for your input.
posted on November 13, 2000 01:56:48 PMSeems to me to be a cost of doing business for her, so she can collect her money sooner.
I'm looking for suggestions on how I should handle this, as I would like to use Paypal, because of its ease of use. Thanks for your input.
Many sellers use PayPal because it saves them time and the hassle of worrying about deadbeat bidders. Therefore it benefits the seller.
Other sellers offer PayPal as a convenience to the buyer, enabling them to avoid sending a check or purchasing a money order while getting their item quicker.
It's really a little of both I think. Personally, I don't think passing the fees on to the buyer are against eBay's written TOS. But eBay seems to be interpreting the existing rules ala Billpoint to cover PayPal. There has been a lot of debate on these boards over this question.
I think it would be up to you to decide whatever you think is fair. If you choose to refuse to pay the fee, eBay will probably back you up.
posted on November 13, 2000 02:16:05 PM
If you do not like the Paypal fees being passed on by the seller, then just use another payment option. It may be cheaper for you to use Paypal though.
I received an EOA last week where the seller said the fee for using Paypal would be $1.00. Since the purchase & shipping amount was less than $10, I knew this was much more than what her fees would be. And since postage is only $.32, I opted to mail her a check. I wasn't in any rush and if she was willing to hold onto her merchandise while the check processed, that was fine with me as well.
ANY FEES need to be in the TOS so the buyer can see it before they bid. Tacking fees onto the EOA is just plain wrong.
And when I do pay by Paypal, I always include an additional $.50 or so to cover any fees, even when not requested by the seller.
**************************
That's Flunky Gerbiltush to you!
posted on November 13, 2000 02:24:37 PM
This practice will SOON be officially against ebays policies.........Ebay will have to comeout with an "official stance" on this practice.........not that boldof a prediction but an accurate , as time will tell, none the less.........
posted on November 13, 2000 05:29:13 PM
I am a seller and after recently being 'coerced' into upgrading my paypal account, have now taken the logos off my auctions, and this weekend, for the first time, will send my end of auction emails stating that I take paydirect, a free service, and also paypal for a .25 fee which is a fee I can not absorb. That's below the minimum charge for most of my items and I also state if the fee is higher, I'll pick up the difference. Very curious to see what affect this has on paypal users! It's still cheaper than a stamp and a money order.. and it is a convenience to the bidder more than the seller, in my humble opinion, to USE paypal, so why should I pay it?
If one of those bidders turns you in, expect to be in the same position as another thread, w/o auctions. Is it worth risking it over a $.25 fee?
ebay has stated in letters that they do not allow the direct passing on of PayPal & BillPoint charges to bidders. Twinsoft & I both had threads on this a few weeks ago w/letters from ebay regarding this matter.
By "direct" is when you tell your customer, Pay with PayPal & you owe me another $.25".
Indirectly, you can build it into a "handling fee" or into your starting fee but if you try to charge DIRECT & someone turns you in, ebay is going to tell you that you can't do it.
posted on November 13, 2000 05:54:32 PM
I won 3 bids over the weekend and all 3 told me if I wanted to use PayPal, that the additional fee was ***. Not one of the 3 ever mentioned in their auction that PayPal was more expensive (I used PayPal since the items that I purchased were not expensive and the additional fee was less than .75 in all cases). I just think that if additional fees for the use of PayPal were to be charged, it should be mentioned!
posted on November 13, 2000 06:09:27 PM
In my humble opinion all businesses have overhead cost usually they are absorbed in the cost of the item when purchased that is why we purchase wholesale cost and sell at retail.
it is illegal to charge anyone for the cost of credit card fee's
posted on November 13, 2000 06:09:38 PM
I frankly think that if a seller directly charges PayPal fees to bidders, they probably would not get my business. It's really low class. Imagine going into a store and being charged a fee for using the bathroom.
posted on November 13, 2000 06:19:18 PM
most of my buyers use paypal and i would never think of passing the fee onto them. to me, being disabled, paypal saves time and helps me out!
posted on November 13, 2000 06:45:07 PM"I was advised that if I wish to pay via Paypal, I will have to pay the additional charge accessed to paypal business accounts."
The seller is in error, you can report this to Safe Harbor and they will inform the seller they aren't allowed to do that.
If I go get my wife a half gallon of tuna flavored ice-cream the store can charge extra for many things.
They can charge me for parking.
They can charge me for use of the shopping cart
They can charge me for grocery bag.
They can charge me extra to turn on the belt at the register.
They can charge me to use the bathroom.
They can charge me for a drink of water.
They can offer a discount for cash payment.
They can't charge me extra if I use my credit or debit card.
posted on November 13, 2000 06:56:28 PM
It is illegal in most states to add a charge for use of a credit. But the one doing this is Paypal. They have stated that they are adding this charge because this is what they are charged to process credit cards. The way I see it, Paypal is the one with the merchant account and they are the ones breaking the law. Sellers are not charging a fee for credit card use. My customers are able to use their credit cards for free with Exchangepath, Payplace, Moneyzap. But not with Paypal because PP is breaking the law.
If a customer insists on overnight shipping, they will pay extra. If a customer insists on paying with a service that charges a fee when there are so many other choices, it is for their convenience, not mine. I would close my PP account completely except that about once every two weeks I run into someone who insists on using it. If they insist on doing business with this company, then they have to pay the fee. I give them plenty of other choices. And yes, I state this in my TOS.
posted on November 13, 2000 07:03:27 PM"...PP is breaking the law."
So if PayPal is breaking the law by charging seller's a fee then it would also seem logical that BillPoint, Ecount, ProPay, and any other online service that has charges a fee is illegal also. Damn! Have you reported this to the authorities?
Your argument is either totally without validity or a lot of companies are in for a BIG suprise.
posted on November 13, 2000 07:13:00 PM
>>So if PayPal is breaking the law by charging seller's a fee then it would also seem logical that BillPoint, Ecount, ProPay, and any other online service that has charges a fee is illegal also. Damn! Have you reported this to the authorities?
Your argument is either totally without validity or a lot of companies are in for a BIG suprise. <<
As I said, for those who keep stating that it is illegal for sellers to charge for Paypal, it is not the sellers who are doing something illegal, it is Paypal (and the other payment services). I have not heard of any merchant account that doesnt make the merchant sign an agreement that states merchant may not charge for use of a credit card. Paypal is the merchant. No one who accepts Paypal had to sign such an agreement. So if any laws are being broken, it is by Paypal.
The problem is that so far these payment services are unregulated and free to do whatever the heck they want, including freezing entire accounts over $19 disputes, including accepting money into frozen accounts and making innocent people pay for someone else's fraud. When and if these services ever do get regulated, it would not surprise me if the surcharge were also ruled illegal.
I have no problem telling my customers right in my auction TOS that I do not recommend Paypal. There are plenty of better services. If they insist on using a company that treats its customers with such disdain, they had better be prepared to pay the cost. Then I send them to this page
http://www.ygoodman.com/paypal.html
Feel free to link to it and show it to your customers. I went from 8-10 PP payments a week to one in two weeks. I am sending 8-10 customers a week to Exchangepath.
posted on November 13, 2000 07:44:21 PM
Thank you everyone for your thoughts. It seems that it is quite divided as to if this is acceptable and/or right or wrong. I think, as sellers, we add Paypal to offer additional ways for a bidder to pay, very much like a merchant accepts a credit card. I'm sure merchants absorb this cost into the price of thier item, which I think is acceptable. Since I have been selling and buying for sometime now, this is the first time I came across a seller that wanted to add it in at the end. There is nothing listed in the auction that states additional charges for paying via Paypal.
Paypal offers a service to both the seller and the buyer, so it is in no way more convienent only for the buyer to justify the bidder picking up the extra charge. If this seller had a personal account, there would be no fees incurred for the use of Paypal, which I guess is why I find this so unusual, to say the least. I don't feel I should have to pay additional fees just because this seller has a business account. This kinda reminds me of back in the days of a cash price and a charge price for gasoline. Personally, I'd choose cash every time. Also, what gets me is that the seller wants me to calculate the charges. I guess I'll send a personal check and spend .33 and let the seller wait for my payment and wait to see if my check actually clears.
posted on November 13, 2000 07:59:10 PM
Several weeks ago, I asked SafeHarbor about DIRECTLY adding a charge for PayPal to auctions, in other words, where it was DIRECTLY stated in the TOS that $XX was added to pay for PayPal fees.
I received a letter back from them which I included in a thread here on AW. Twinsoft got about the same response I did in the same timeframe.
Both indicated that ebay did not allow sellers to place a DIRECT charge on their customers for using either PayPal or BillPoint.
Now that ebay has started to close auctions who do this (see the other thread on this), I think it send a pretty clear message, ebay doesn't allow it.
All the semantics in the world about what is and isn't a merchant account will not matter if ebay says the seller can't do it. They also say sellers can't sell guns, alcohol & other things which are legal elsewhere but it's THEIR site & THEIR rules.
Here's the thread w/the email I received from ebay.
posted on November 13, 2000 08:48:00 PM
Has anyone thought that it costs EVERY Gas Station, Flower Shop, Grocery Store etc., that to accept you CC ( which is USUALLY lnked to a bank account) @ 25 cents for each transaction?
Why should we(sellers) charge an extra cost if THEY don't...get a clue, and "build" the fee into your auction!!!!
Keith
I assume full responsibility for my actions, except
the ones that are someone else's fault.
posted on November 14, 2000 04:26:07 AM
Yeah, but we're getting dinged for what basically are cash transactions, too (PayPal account balance transfers).
It doesn't cost the gas station, flower shop, etc. merchant account fees to accept cash.
posted on November 14, 2000 06:39:01 AM
I am a seller, I use PayPal Business - we would NEVER charge for using PayPal or any other such service - this is simply a seller's cost of doing business.
REPORT this person, and send a copy of their e-mail to PAYPAL & TO SAFEHARBOR, Visa or Master....
Charging for such a service is against the agreements with Visa & Master.
REPORT ALL SELLERS ATTEMPTING TO CHARGE TO USE CREDIT CARDS - OR SERVICES LIKE PAYPAL - TO BOTH THE SERVICE, (I.E.) PAYPAL, VISA, MASTER, and THROUGH THE AUCTION THEY ARE POSTING ON.
posted on November 14, 2000 07:15:47 AMREPORT this person, and send a copy of their e-mail to PAYPAL & TO SAFEHARBOR, Visa or Master....
What do you suggest reporting this person for? The originator of this thread (eilatan99) has made two posts, but has never made the claim that a credit card was used in the transaction.
It is possible to use PayPal, without using a credit card. From PayPal:
How do I add funds to my PayPal account?
You may add funds to your PayPal account by electronic funds transfer from your bank account or by sending a check to PayPal. To add money electronically, you must first confirm your bank account.
Assuming a buyer does not possess a credit card and funds his account through one of the methods above, what action do you suppose MasterCard or Visa is likely to take in the event of a complaint?
posted on November 14, 2000 01:23:24 PM
Egads eventer.. thank you! I read tons on these boards and somehow missed all you refer to.. will NOT go and state an additional charge then. Definately not worth it over .25! Thank you thank you thank you. If you were here in Florida with me, I'd vote for you for best advisor on AW
posted on November 14, 2000 02:12:12 PM
All of the threads on this subject have posters who keep repeating a fallacy...the fallacy is that paypal is in violation of the law for charging for credit cards.
The law in regards to not passing on the fees charged by the dredit card companies to the merchant addresses the passing of those fees to the buyer..ie, the holder of the credit card.
Let's use Bob's Brake Service as an example. Bob has a merchant account and is able to accept credit cards (visa MC) for the brake jobs he does. Mrs Smith comes in and has Bob fix her brakes and the job cost $100. Mrs Smith gives Bob her Visa card to pay for the brakes. Bob is charged $2 by the credit card company to accept this card. He cannot charge Mrs Smith $102 for the job..if he does he is in violation of his merchant account and in some states, the law.
But, let's say Bob has mechanics who are paid the amount of the job. His mechanics pay Bob a rental for the workspace they use to fix brakes. Bob takes 10% of the job price. Joe was the mechanic who did Mrs. Smith's brake job. If Mrs Smith had paid in cash, Joe would get $90 and Bob $10. But Mrs Smith charges the brake job. So Bob pays Joe $88, deductiong the Visa charge. There is nothing illegal about this because the law addresses what Mrs Smith pays to Bob..not what Bob pays to Joe.
With paypal..paypal does NOT charge a surcharge or any fee to the users of the credit card (the credit card holder). Paypal's charge of a fee to us as recipient of the funds from that credit card is not illegal...we are not the credit card holder.
The laws were passed so that the card holder/card user would not be penalized by higher charges for the use of the card. It does not address the situation of paypal passing the fees on to us the sellers.
posted on November 14, 2000 02:21:23 PM
Buyers- if you purchase a widget from Bob's House O' Widgets and pay with a credit card through PayPal, want to make a bet which business (Bob's or PayPal) will show up on your cc statement as the merchant who accepted the charge?
posted on November 14, 2000 02:49:25 PM
Mrpotatoehead..your right, paypal will show up on the BUYERS credit card staement. but it would not show up on Bob's House o'Widgets credit card statement...nor will the credit card company charge Bob's House o'Widget the processing fee...they charge that to paypal. The merchant agreement and the law forbids paypal from passing that fee on to the credit card user..it does not forbid paypal from passing it on to a third party.
The law is addressing paypal and the buyer...paypal cannot charge the buyer. that's why paypal will "always be free" for those who fund their paypal account with their credit cards!
The problem here is people keep saying paypal cannot pass the fees on to the "customer" and then say "we the sellers are paypal's customers" and draw a conclusion paypal cannot pass the fee on to us. But the law is about the credit card holder, not the "customer".
The problem here is people keep saying paypal cannot pass the fees on to the "customer" and then say "we the sellers are paypal's customers" and draw a conclusion paypal cannot pass the fee on to us. But the law is about the credit card holder, not the "customer".
I agree 100%, and it is frustrating to keep reading posts that claim that the eBay seller is somehow the "merchant" in the transaction with the cc company.
It would be equally silly to insist that, when sending a money order, the buyer was paying with cash, because that is how the buyer paid for the money order.
What I said was it was WRONG for a seller to charge to us the service, and "if" I were a buyer I'd report them to PayPal. This is the type of seller who gives Sellers a bad name.
MrP
