Hi Mamas! This is my first time posting on this board, I'm usually on the sewing board, and sometimes on the market board. I have a biz-related question and thought I'd ask here first.

Who here accepts Credit Card Paypal payments? Do you add the service charge onto your orders or do you absorb it yourself? My business is just under a year old, and it has grown to the point where I am being asked for CC payments regularly. But I'm not yet at the point where I can afford to pay the Paypal fees myself. I don't like to inflate my prices to cover such things (I don't think someone who is paying by funded paypal should necessarily have to pay for someone else's cc fees, you know??) but I may have to. If most of the payments come through CC paypal, then it's justified. But what do I do in the "in-between" time? :)

Oh, and in case it's relevant, the fee for CC paypal is 2.7% + $0.55 CAD to 3.4% + $0.55 CAD (I'm in Canada)

Just wondering what your experience is, and what you'd suggest. Thanks!!

Oh, and I know some of you, but a quick intro: my name is Ana, I'm 28, yoga instructor and mom of one daughter, Jasmine who just turned two.

Who here accepts Credit Card Paypal payments? Do you add the service charge onto your orders or do you absorb it yourself?

I accept cc paypal. I have two accounts: one personal, and one business. I receive the majority of my payments to my business account (which charges fees), but I also take funded paypal payment at my personal account. I do "absorb" the fees myself (as in, I don't charge the customer for the paypal fees...their price is the same whether they pay to my personal or business account), however Paypal fees are a deductible expense so it doesn't really hurt you in the end. When you file your taxes, you deduct the Paypal fees on the Schedule C.

I don't think you're allowed to pass the paypal fees on to the customer (according to Paypal's policy), or maybe that is just for auctions. But for auctions, I do add an incentive for people to pay to my personal (non-fee) account. I offer free wipes if they pay to that account. I don't do this with my regular website orders, though.

That's what I do, anyway. I'm sure others will have more to say.

Hey Ana!!!

I accept both funded and cc payment via paypal. I chose to have them go into one account because I can keep better track of payments this way. (The more simple the better...for me anyway! :D )

The fees do add up, but in comparison to other credit card processors (did I spell that right? looks funny), paypal is very very reasonable. as for the fees, i absorb them as well, and feel that this is my expense. i think you may need to check about paypal's policy about passing those charges to customers. i was under the impression that that was not acceptable to them. while you can "inflate" your prices a little without trouble...stating that you need to "add .30 cents plus a percentage to your order" *might* be a no-no...

IMO, you can only grow by accepting CC payments, as retailers we almost have to capitalize on the power of impulse buying LOL.

Take care! Hope all is well!

Hmm, ok, I didn't know that about passing on the fees etc. I'll have to read their policy. One more question ~ so can you have a Premier account, and you only get charged that percentage IF the payment is coming from a CC account, or will you get charged the percentage regardless on EVERY transaction? ie - even if the payment is coming from a funded account. I'd rather keep one account to keep things simple :)

edited to add: Hi Tiff!!! Yup, we're all well, thanks! ;)

Dear Ana:

When you have a Premier Business account, you get charged a fee everytime someone sends you a payment, regardless if it CC or a funded account. I agree with others that say, even so, PayPal is a lot cheaper than setting up to accept CC any other way. It really does help your business to be able to accept CC, even if it's online only. PayPal online is the only way I accept CC and I'd rather make the sale than to turn someone away. If you think about it, you will save gas money and time by not having to go to the bank everytime you make a sale. It all seems to even out in the end for me.

I looked into being able to accept CC over the phone and was blown away by the fees! There's a set up fee, monthly fee and per transaction fee!

Don't feel guilty about inflating your prices to cover the fee -- that's business. 3-5% doesn't add up to much. I'm a WAHM and, like many others, I have difficulty charging what my handcrafted products are worth. I don't know why we undervalue our creation time; we deserve a decent wage, too!

~ Kathryn

http://www.thesilverpenny.com

another way around it is to only accept funded paypal but to sign up with something like http://www.propay.com for accepting credit cards. They're fees are comparable to paypal. The only difference is it takes about a week to access your money (3 days to clear into your propay acct and 3 days to transfer to your bank acct) That way you would only have fees for cc payments and not for funded paypal payments.

I've been wanting to drop down to just accepting funded paypal for a while...been using propay for over a year and really don't need to have the cc paypal option. I'm just so addicted to the ease of the paypal debit card! LOL!

although maybe if I ditched the cc paypal I might not spend my paypal as soon as I get it. :rolleyes:

I've been wanting to drop down to just accepting funded paypal for a while...been using propay for over a year and really don't need to have the cc paypal option. I'm just so addicted to the ease of the paypal debit card! LOL!

Dannielle,

I don't know if this would be what would happen to you if you drop down, but here is what happened to me. My personal account USED to be a business account. I had the paypal debit card, too. Then I downgraded my account back to personal (because I opened a second business account). I didn't realize it but the debit card was still active. I never tried to use it. But then they sent me a renewal card many months later. I was confused about it so I contacted them. And they said yes, I could still use it. I chose not to, since I was kinda afraid they would automatically upgrade my account if I used it (even though they had told me otherwise). I have a paypal debit card on my second (business) account, so that's the one I do use. I just cut up the debit card on my personal account. But my point is that you MAY still get to use your debit card even if you do downgrade your account.

HTH!

- Anne

Thanks Danielle and Kathryn! Learning lots of new stuff here...

Also, I couldn't find anything on Paypal re. charging customers for their charges, etc. I'm not doubting what you've said, I just can't find it! If anyone knows whereabouts it is, I'd be grateful. But don't spend too much time looking for it, I'm still searching...

Many thanks!
Ana

I don't know where on their site to find it, but I agree with the others who say PayPal frowns upon passing on the fees to customers. I think I remember getting an email about it quite a while ago, probably a policy update at one time. Most likely, it's part of their user agreement.

~ Kathryn

http://www.thesilverpenny.com

From the user's agreement:

No Surcharges. Under Visa, MasterCard, Discover and American Express regulations and the laws of several states, including California, merchants may not charge a fee to the buyer for accepting credit card payments (often called a "surcharge"). You agree that you will not impose a surcharge or any other fee for accepting PayPal as payment. This restriction does not prevent you from imposing a handling fee in connection with the sale of goods or services, as long as the handling fee does not operate as a surcharge (in other words, the handling fee for transactions paid through PayPal may not be higher than the handling fee for transactions paid through other payment methods).

Thank you!!