caveat emptor - Marketplace Scamming Prevention

[Slashmaster]

even if you come right out and say "My prices are higher to cover Paypal fees" (and this statement might still be against Paypal's TOS).

I believe you would put "higher prices are due to the cost of doing business and apply regardless of which service is used." this means they pay $1.50 regardless of whether they pay you PayPal, cash, check, etc.

It's much easier to show the price they are paying for the art and include Paypal fees in later so the buyer can see the breakdown and feel more comfortable that they know exactly what their money is going toward.

Again, this is risky behavior - they can report you to paypal - or even not a buyer, a viewer of your art thread/auction/commissions journal can report you to paypal.

you can use the gift option (which I don't like to do, because it seems fishy if you are sent gifts a lot)

This is risky behavior also, as you can be reported for it and have your account closed (including they keep all the money in it). I also suspect PayPal flags some gift transactions and reviews them for legitimacy.

Last time I checked, I believe that money transferred instantly via Paypal credits (i.e. you already have $200 sitting in your Paypal account balance that you use to pay for things) to other personal accounts will not charge a fee.

Not to my knowledge... I pay out of a paypal balance and my contractors still state they get charged the fee.

Paypal fees are similar to sales tax

Not at all. You still have to charge the customer sales tax if they live in the same state as you do (but that's beside the point). PayPal fees are similar to credit card transaction fees. YOU still pay them, even if you are a business with a credit card swiper. The customer doesn't pay the CC fee as far as I'm aware... This is why a lot of businesses don't take CC transactions under $5 - it's a loss for them.


Ultimately - it's up to you if you want to charge your customers the paypal fee. But it is risky behavior, and you are gambling with losing your paypal account (including any funds inside it). Whether that risk is worth it is up to you.

[Tragedy]

I believe you would put "higher prices are due to the cost of doing business and apply regardless of which service is used." this means they pay $1.50 regardless of whether they pay you PayPal, cash, check, etc.

I feel worse in doing this because $1.50 is usually a lot higher than it would be for a buyer to cover the cost of Paypal fees. It's usually less than $0.70 because I don't do a lot of high-dollar sales or bulk packages to one individual. Even tacking on $1.00 makes the price seem higher, and possibly deters people from buying.

This is risky behavior also, as you can be reported for it and have your account closed (including they keep all the money in it). I also suspect PayPal flags some gift transactions and reviews them for legitimacy.

I don't offer my Paypal address upfront or on a thread, only to people who are buying from me when the payment is due. They would have to either have bought from me before, or stage a purchase, and if they're going through all that just to get me in trouble, they either have a serious grudge against me, or nothing better to do with their time.. or maybe extremely high and unusual ethical standards.

This is risky behavior also, as you can be reported for it and have your account closed (including they keep all the money in it). I also suspect PayPal flags some gift transactions and reviews them for legitimacy.

That's why I don't like it when people gift payment to me, but it's not something I can control, other than me saying "Please don't gift the money to me" and then they can do it anyway. It usually comes from one time buyers or commissioners and it's only happened maybe twice for amounts smaller than $10.

Not to my knowledge... I pay out of a paypal balance and my contractors still state they get charged the fee.

Is it possible their accounts are set up as premier accounts? I think that rule only applies to personal accounts, or it may have changed since I last looked it up.

Not at all. You still have to charge the customer sales tax if they live in the same state as you do (but that's beside the point). PayPal fees are similar to credit card transaction fees. YOU still pay them, even if you are a business with a credit card swiper. The customer doesn't pay the CC fee as far as I'm aware... This is why a lot of businesses don't take CC transactions under $5 - it's a loss for them.

I've never had a credit card (I pay with cash 95% of the time) so I wouldn't know much about that. I guess it depends on what perspective you're viewing the situation from.

Ultimately - it's up to you if you want to charge your customers the paypal fee. But it is risky behavior, and you are gambling with losing your paypal account (including any funds inside it). Whether that risk is worth it is up to you.

I understand. I'm not quite sure how I feel about it now that you've stressed the fact that it's a risk, because it is indeed a risk- I don't want to have to increase my prices by a fixed amount, and I don't want to have to lose money because of the fees either. I only do business in two small vps community forums and with whatever site I work for on a consistent basis (and I have never charged ppcalc for sites that I work or am staff for) and it's not often, so I think I'll be okay, unless someone really wants to make life difficult for me. ;p

[Ollie]

Thanks slash! This has been a fantastic read, very useful.