Does using Paypal cost you?

[bloodhound31]

I am just wondering how Paypal makes it's money.

I can sign up for free, set up online stores and sell stuff online. I can't seem to find anywhere that tells me if there is a cost for me to use paypal to accept my customers payments.

Anyone? :question::shrug:

Baz.

[koputai]

Yes, you as the seller pay fees to Paypal. The fees are not too bad for local (Australian) payments, but once you are dealing with foreign transfers it gets a bit exy. As an example, I sell a product for around $1400 AUD, and Paypal charges me about $65 each time someone pays from overseas.
The fees structure is there on the website.
https://www.paypal.com/au/cgi-bin/webscr?cmd=_display-fees-outside&nav=1.0.1

Cheers,
Jason.

[iceman]

It does cost you.
https://www.paypal.com/au/cgi-bin/webscr?cmd=_display-fees-outside

It's free to PAY someone via paypal, but it costs the person receiving the money (up to 3.5%).

The seller usually passes this cost onto the buyer.

[casstony]

You can hold a balance on paypal - if you hold that in $US you'll have spending money sitting there if our currency turns south. You lose about 2.5 cents on the paypal currency transfer and the money is not guaranteed, but I think it's ok to take the risk on an amount that you are comfortable with.

[JimmyH155]

I cant understand it. Took me 2 hours yesterday just to sign in. They told me I was already registered and I had of course forgotten password. Eventually I got in and set up my bank account to pay from (good idea guys, or dumb??):shrug:
Then they said they were going to put a little bit of money (less than a $) into the a/c to prove all is well....is that fair dinkum???
Dont know if I will ever dare to use it though:mad2:

[casstony]

We have a bank account linked to paypal and have had no problems, but we don't keep much in that account to reduce our exposure to theft. You get an e-mail every time there's a transaction so theft should be quickly spotted.

[rogerg]

I don't understand what your question/concern is, perhaps you could elaborate?

They do the transaction to confirm that you own the bank account you have entered. When you receive the transaction you need to relay back to Pay-Pal information contained in that transaction. In that way they ensure you are a person who has access to that bank account, that you haven't entered details of someone else's bank account that you're going to try and fraudulently take money out of.

I haven't had problems with Pay-Pal in the 8 years I've used it for selling & buying. They do charge a percentage fee (charge it to the seller), but from a merchant's point of view that percentage is likely quite competitive (it does depend on a lot of factors such as amount of $$ transacted for a period) - For example if the percentage is 3%, and you're doing low volumes, a comparison would be having a bank internet merchant account together with an alternative payment gateway, resulting in a merchant fee from the bank of about 3% - 4.5% plus a fee from the payment gateway of choice (usually a transaction fee along the lines of 50c/trans). The story is different for large volume merchants, where bank merchant fees come down to 1.5%-2.5%.

Roger.

[Allan_L]

If you want to really safeguard your money, you can get a security number generator that will generate a random number you have to enter to authorise nay transaction.
I think it is safer than the banks.

[wasyoungonce]

Paypal has been known to "lock sellers accounts"..until verified.

That is paypal asks you to prove you are a valid seller by showing receipts for purchase of goods you are selling, bank account details...etc etc.

They have done this many times before. Literally sizing funds & giving the seller a massive run around that can take week/months to resolve...sometimes never!

They have a habit of doing this when the seller has a large amount of money in their account.

Just head on over to the whirlpool forum on this. Sellers have had to resort to take paypal to court to get funds released.

Best you visit the whirlpool forum & have a good long read on paypal.

[Exfso]

Just as an aside, regarding Paypal, I had an account and somehow some unscrupulous mongrel managed to get my details and garnished money from the bank account I had linked to it. They say they are safe, but in my case I got ripped.:mad2:

[bloodhound31]

Best to use a bank account that ONLY your paypal transactions use.

The amount less than a dollar they deposit into your account is a legit way to test whether you are who you say you are and that the transfer system works. I did it 2 days ago and got it sorted yesterday fine.

I see now that they take a small percentage of every sale, but more if it is overseas.

Thanks very much for all your answers folks, it certainly was a worthwhile thread. You all rock!

Baz.

[stephenb]

I have a PayPal account and have used it regularly for about 3 years.

1. My PayPal is linked to a small account at a bank which is separate to my everyday accounts.

2. I have a small surplus in PayPal funds, usually $50-100 also.



Yes they do deposit a small amount to your bank account - normally 3 or 4 cents. When you check your account, you then confirm the amount with PayPal. This is to ensure you are the authorised account holder. This is completely normal.

I have never had an issue with PayPal. For buying goods overseas, I believe it is safer than providing credit card details. PayPal is the "middle man" for me and once you start using it, you become confident in its use.

[marki]

Yep, use it all the time and have never had any problems personally. A work collegue did though. Some little snot got hold of his details and bought 8K worth of iphones :screwy:. Paypal had already locked the account and were pursuing the thief before Dave even knew it had happend (they contacted him). He got all his money back and the kid got prosecuted for theft etc. Smart enough to break into the system, dumb enough to have the phones sent to his home address :P:D. This took less then 24 hours for them to sort out.

Mark

[erick]

I'm a buyer only and have been very happy with my Paypal account. However I recently found it locked and had to go through a procedure to prove identity and get it unlocked (and change password). They explained that there had been unauthorised access to my account. I could see no unusual transactions so I asked them to explain further in case it was something I had control over. They said no, it's confidential and they have dealt with the matter. A bit unsatisfactory, but no problems since.

[rat156]

I have had my account locked twice because of nefarious transactions. Both times Paypal notified me of the transactions and refunded any money. I have also had an eBay transaction go bad, and paypal lived up to their promise and refunded the money.

I use them even for within Australia payments because of the security of knowing if someone takes your money and doesn't come through with the goods you are protected.

Cheers
Stuart

[Jules76]

Paypal is great for purchasing items overseas. I've found some retailers require verification for overseas customers when you use Credit Card to pay, especially when the delivery address is not the same as the billing address. This often involves sending a photocopy of your Credit Card and some form of ID. In today's climate where identitfy theft is such a big problem over the internet, I REALLY don't want to have to do that.

However, if they take Paypal, there is no such requirement other than you need to have gone through the Paypal verified process. Essentially, Paypal has already confirmed you to be good.

[GrahamL]

I've never had a problem with paypal .. but on higher priced overseas purchases would definately have a look at other payment options
aside the fees I believe they skim a little on official exchange rates bumping up the price just that little bit more.

[multiweb]

It does take a fair chunk in commissions if you move large amounts of money though.

[koputai]

I'd just like to relate a POSITIVE Paypal story.

A few weeks ago I bought a Canon lens on Ebay for $900 and paid via Paypal. I have a lot of Ebay experience, and thought I could judge ads pretty well.

Anyway, this guy ripped me off. I never received the lens, and never heard from him again. He also sold the same lens a day later to someone else, who undoubtedly got ripped off as well.

Once I realised I'd been taken, I lodged a complaint with Ebay, which was instantly converted to a Paypal 'Claim', as I guess the second purchaser had already done the same.

Paypal investigated, managed to get the money back from the scammer, and has reimbursed my account. Thanks Paypal !

I think if you pay with Paypal then you are well covered. That said, I will never buy from an Ebay seller with a feedback of less than 25 ever again.

Cheers,
Jason.

[Kevnool]

Paypal is all good here as a buyer.......Not even a worried about using it.

I even use paypal away from ebay as well such as other online sellers who display paypal.

Cheers Kev.

[wasyoungonce]

If you really think you are covered...I hate to bear bad news. If Paypal cannot recover the money from the other party (aka they have shot thru)...then..you are "stiffed" so to speak.

Read the terms of paypal protection here (https://cms.paypal.com/au/cgi-bin/marketingweb?cmd=_render-content&content_ID=ua/BuyerProtComp_full&locale.x=en_AU):

Here is an extract:
PayPal has two programs to assist buyers:



the PayPal Buyer Complaint Policy - under which buyers may be able to recover their payments from sellers; and
this PayPal Buyer Protection Policy – under which buyers may have funds recovered from a seller or may, at PayPal's sole and absolute discretion, receive a payment from PayPal.

......However, where PayPal is unable to recover the whole or any part of your payment from the seller for a claim, PayPal may at its absolute and sole discretion, decide to make an ex gratia payment, not exceeding the financial limits set out in paragraph 3 below.

These do not sound like the words of "protection" I like to hear. Paypal has it all their way..they take none of the risks...you do.

That said. I use paypal and am very wary of where/whom I send my funds to.

Credit card is better as you can at least to a reverse charge!

[MrB]

I've also never had a problem with PP as a buyer, I've not yet used it as a seller.

I've also had an Ebay purchase go bad, many other buyers got stiffed by the same seller and no one was able to contact the seller, PP refunded me (many hundreds) with no delay.