Clients don't realize the transaction fee is being deducted from their payments.

[timbre]

Although I do inform them, short-term clients often misunderstand the transaction fee, or don't remember it. A client thinks he is paying, say, $400, but in fact his bill is not paid in full. 

If the PayPal interface made it clear that, "You're paying $____" and "Payee will receive $____" then they'd immediately see how much to send in order to clear their bill.

Is there any way to make this more obvious? With informal personal payments, I have friends use a different PayPal account, but for work, I'm getting dinged again and again, which requires adjustments with the clients, etc. It's a significant hassle, and should be easy to fix. But people respond to the numbers, not reminders and notes, etc. And I hate to re-bill them for the fee amount (which of course incurs yet another fee).

Thanks in advance for the help,

Allen

[PayPal_Olivia]

Hi @timbre, 

Thank you for joining the PayPal Community Forum, and welcome! I appreciate you asking your question here, and I'll be happy to shed some light on things for you.

I understand the desire to have the fees clear to a customer, however, fees are the responsibility of the seller to pay. The buyer is not responsible for the fees. If the price of an item or service is $400, that is what the buyer should be paying. As the seller of the item or the service, the cost of using the PayPal system is to be absorbed by you as the cost of doing business using PayPal as the payment processor. To request that a buyer pay the costs of using PayPal would be to surcharge the customer, which is not permitted. More can be read regarding activities that are not allowed by clicking Legal at the bottom of the PayPal website. The User Agreement can be found there.

I hope this information is helpful in planning for future payments. I am sorry for any inconvenience or confusion.

Olivia

[timbre]

Hi @olivia,

Thank you for your detailed and speedy response. I find it a little confusing. While I think I understand that an explicit surcharge is prohibited, it seems to contradict the conventional practice of charging the customer for other standard expenses like shipping, handling, expedited services, wire transfer costs, and the like. Only some of these are typically considered surcharges, at least in my experience. And surely all businesses account for these one way or another. Obviously, a vendor can simply build all of these expenses into the invoice (and I'm sure that most do), but it sounds like that would be prohibited, too -- if I'm reading your explanation correctly. I certainly don't want to break the PayPal rules, or any other commerce regulations, so I'm not sure how to proceed. It seems that this specific cost of a transaction cannot be passed on to the customer, while most (if not all) other such costs can. If you can clarify this policy a little further, I'd be most grateful.

Thanks,

Allen

[PayPal_Olivia]

Hi @timbre,

Thank you for that reply. I'll be happy to explain further.

The difference between charging for things like shipping, handling, and other costs incurred is that charging the fees for using PayPal would be a cost only incurred by people using PayPal. If it costs someone $400 to get your service when paying with cash or check but it costs them $400 +  a fee if they use PayPal, that would be a surcharge. Similarly, if you built your cost in such a way that all customers paid $425 for your service, that would make the price of your service $425, and that would be fine. If you then gave a discount for using cash or check, then we're back in surcharge territory because the cost is different for using PayPal as opposed to other methods of payment.

I hope this helps clarify!

Olivia

[Temp20230709b]

Thank you for your response. I understand Paypal's point of not wanting to add costs to the customer. However, when one charges an amount from abroad it is normal for the customer to pay that amount plus the commission charged by whatever shipping system they use (including paypal). For example, if something is worth $20 and you pay it by Money Gram, Money Gram would charge you $20 plus their transfer fee. The same with any other system. The customer understands this perfectly. Now, if he chooses to pay by paypal he would have no problem adding a commission since all other means would charge him. He just needs to have the option to put the amount he wants to get to the destination and know the commission that is being added for this. Shipping commission payments exist on all shipping methods and are always borne by the customer. When paypal, however, charges this fee to the seller, it is creating a detriment to the seller that the other systems do not infringe.