Using Paypal for Classified Ad Sales/Purchases

Many FAOL buyers and sellers use Paypal to pay for items bought and sold here, and elsewhere (I'm referring to items other than Ebay transactions).

Some sellers ask for an additional amount (or a % of the selling price) when Paypal is used to cover Paypal's fees. I haven't generally asked for an addional amount on items I've sold, but have simply absorbed Paypal's fees in my net selling price.

However, you can pay for a purchase though Paypal and not incur any fees if you code the payment as a personal payment. There is no Paypal Purchase Protection on personal payments if the buyer does not ship the item after you pay for it, for example, but after reading Paypal's Legal Agreements I'm not sure you'll have this protection anyway.

Do any of you make payments for purchases through Paypal as personal payments? Is there any downside in doing it?

John

John,

When I've purchased items through PayPal I've always gone with their 'regular' service. I don't remember seeing 'personal payment' as an option anywhere in the process.

I had one instance where the product was never shipped, and I got my funds returned from PayPal.

As a 'buyer', having this protection has always appealed to me. Remember, though, that PayPal isn't the only recourse that a customer has. If they pay with Master Card or Visa and don't receive the merchandise, they can get their money back from the card company (MC and Vise just deduct it from PayPal).

If, as a sellar, you don't want to pay the PayPal fees, you can always get yourself set up to accept credit cards directly. I've always done that and never used PayPal from the sellars end. There are costs involved, but there are always costs involved in running a business. The overriding factor is being able to conveniently serve your customers. Your bank can help you with that, as can any number of card service companies.

As far as 'adding a surcharge' for folks who use PayPal to pay you, I'd advise against it. I'd not 'pay extra' so that YOU can get paid easier. That starts off the transaction with a bad taste as far as I'm concerned. If the fees are a problem, raise your prices to cover them.

Good Luck!

Buddy

I've used the personal payment when I send my kids money. It is so much easier and free. All my kids have paypal acccounts and paypal debit cards. Works better than Western Union.

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Originally Posted by jimsnarocks

I've used the personal payment when I send my kids money. It is so much easier and free. All my kids have paypal acccounts and paypal debit cards. Works better than Western Union.

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I believe that was one of the reasons Paypal initiated these no-fee transactions. You can code these personal transaction payments as "money owed", which could apply to payments for FOAL classified transactions.

I believe that your seller doesn't have to pay a surcharge if your PP account has a balance in it. True?

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Originally Posted by herefishy

I believe that your seller doesn't have to pay a surcharge if your PP account has a balance in it. True?

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The person receiving the money pays a fee unless the transaction is coded as personal, regardless of whether they have money in their account or not.

I feel pretty much the same way Buddy does. If the fees are a problem, raise the price to cover it. Don't tell folks that they need to cover the fees. That should be built into the price. It's only about 3.5% anyway.

The whole idea of taking PayPal is that it makes it easier for someone to pay you. It ain't a deal until you get paid. I have had very little problem with folks using PayPal with transactions going either way and I have sold some stuff on Ebay in the $5 grand range, paid with PayPal.

At the current time, I use PayPal instead of a credit card gateway because the PayPal fees are less than what I would pay with a gateway. I get a bit more volume and that will change. However, PayPal will always be an option for my customers to use.

Kevin -

I agree with both you and Buddy about not asking people to cover the Paypal fees on top of the selling price, and that's what I've been doing.

My question though is when we buy items through FOAL classifieds, or other places off Ebay ( such as Craigslist, for example), whether we should code our payments as "personal" so that the seller would not have to incur Paypal fees.

I sold a handful of items on Ebay last week. My Ebay fees were about 10% of the selling prices, and my Paypal fees were another 3%. I understood those fees going in when I listed the Ebay items for auction, so while the fees are high (in my opinion) I got the benefits of Ebay's marketplace, and was probably able to sell the itmes at higher prices than if I would have sold them elsewhere.

However, when I sell items here on FOAL, I'm not as inclined to feel obligated to pay those Paypal fees.

Every time I get screwed by someone on eBay and I get my money back from PayPal, I realize the value in that protection.

Conversely, I won't buy anything from someone who incurs a surcharge that doesn't see the value in it as a seller, doesn't understand the concept of business expenses or just doesn't get the fact that folks with credit are willing to spend more.

I really wish PayPal would do what credit card companies do to vendors who give cash discounts...

...drop them!

Any items I buy here on FAOL, or one of the other Boards to which I belong, that I pay PayPal, I code the payment "personal" to save the seller the fees. I look at it that I am dealing through a Community of Friends & being given excellent deals. That being said, I will NOT buy from a new member who is using this site as a "sales tool", but from CONTRIBUTING Members.
Mike