Did you know... no transaction surcharges allowed with PayPal, yet...

[PolurNET]

Hey guys,

It recently came to my attention that sellers of any kind are NOT allowed to impose a PayPal transaction fee surcharge according to their terms of service. Yet, this seems to be a practice used by major companies, such as Enom, BuyDomains and others.

https://www.paypal.com/cgi-bin/webscr?cmd=p/gen/ua/policy_payments-outside

4.6 No Surcharges. You agree that you will not impose a surcharge or any other fee for accepting PayPal as a payment method. You may charge a handling fee in connection with the sale of goods or services, as long as the handling fee does not operate as a surcharge and is not higher than the handling fee you charge for non-PayPal transactions.

https://www.paypal.com/cgi-bin/webs...prior_transaction_id=15533&answer_id=16777218
https://www.paypal.com/cgi-bin/webs...prior_transaction_id=15533&answer_id=16777219

So, when I was in process of ordering a domain at BD today, it's quite a shock they apparently do use a PayPal surcharge:

A 4% PayPal charge (USD $xx.xxx) will be added to the cost of the domains
for TOTAL of $xxx.xx

I've contacted a BD rep to clarify why they do this, since obviously, their other payment methods do not charge such a fee, and there is no "handling fee" in terms of domain names.

Also, this appears to be a practice frequently applied by NamePros sellers themselves, so I think it's useful that everyone knows such a policy is disallowed, for example, if as a seller you want to avoid PayPal fees and try to pass it on to your customer; this is strictly prohibited by their TOS

As for Enom and others like Direct/Resellerclub resellers, I believe they charge a fee before depositing funds via PayPal, even though this should theoretically be disallowed as well. Perhaps this piece of information isn't as clear or visible as it should be, since it is important as a buyer to know such information. The same policy applies when using your Visa/Masercard/Amex, since each of those credit card companies have agreements that explicitly state no surcharge may be applied to any purchase if a buyer uses their credit card. Nevertheless, some mom&pop shops you may have encountered in your area tend to do so anyway...

Hope this info helps someone!

 

[DJ]

Just tried the mass pay option with a single payment and i can confirm it is working fine. If you meet all requirements, this is a good way to save on those additional fee's!

 

[JoeCanadian]

Hopefully we'll see more use of mass pay here. PayPal fees really do add up over the course of a year. Personally I'm happy to absorb the cost of sending money via mass pay if I'm getting 100 cents on the dollar on my sales.

 

[YesBrilliant]

The good news is that there is another 'secret' method I've revealed to some who I've transacted with in the past to substantially reduce PayPal fees (especially for large domain or other manual transactions). Read about "Mass Pay" and you'll be wondering why you've never used it before for your large transactions : it's only a $1 flat charge per transaction and the buyer pays the fee! And no, you don't necessarily have to pay more than one person, even if it's called "Mass Pay"

Thanks a lot for the Mass Pay info.

I knew about the same for CC companies for years but it is quite useful for us to know that too.

 

[peaches017]

Moniker does this too. Very interesting, thanks for sharing.

 

[gingeman]

This is without doubt one of the most interesting and useful threads I have read in 2007. Thank you very much for all the information. I have often asked for the buyer to pay the paypal fees, as sometimes they can phenomenally dent the profits in a sale- if a domain is $3000, you're looking at $120 in fees, which I think is a very large amnount of money for what is essentially an automated process. I will never have to ask again now I know it is contradicting there terms, and have been pointed towards MassPay.
Many, many thanks

 

[PolurNET]

Thanks for the rep Chris. Indeed, I hope this helps in dealing with especially larger transactions. BuyDomains is reviewing the information I gave them about charging extra fees using PayPal, and they informed me I should be getting a reply from management soon!

 

[DJ]

Moniker does this too. Very interesting, thanks for sharing.

indeed, i'll need to ask this to my account manager...

 

[JoeCanadian]

Personally I won't be complaining to Moniker. Moniker gives discounted rates to customer's that minimize its transaction costs. Win/win for everyone.

 

[RickM]

Some how ResellerClub/Directi are immune from this rule...dont ask me how as I dont know, but when I posted on their forums it was clear they had done their homework (for once!).