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  1. #1
    Affiliate Manager frankodelic's Avatar
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    We pay almost a full 1% more to process PayPal payments than we do to process credit cards through our standard merchant account.

    Is there any reason we should be paying extra to offer the option of paying via PayPal? Is PayPal worth the extra 1% we give up?

    Thanks,

    Frank
    UrbanScooters.com
    UrbanScooters.com Affiliate Program

  2. #2
    Affiliate Manager PetsWarehouse.com's Avatar
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    Yes, I would focus on the security it gives the buyer in protecting their transaction. Also, they can take a check. Both with address confirmations, and a brief history of the user.
    We like it on high ticket items like aquarium setups that may go into 2-3,000 dollar range.As long as we ship to a confirmed address the buyer can not do a charge back, as they can with a standard CC.


    The extra point you mention can be averaged into your overall cost of CC expense.

    I would estimate our Paypal sales account for 10% of the orders.

    Works for Ebay, if a seller there refuses Paypal I won't bid.

    Henry
    Pet Dealer AM
    Look for our Private Forum at ABW soon!

  3. #3
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    Actually the buyer can do a charge back! I just had a customer that forgot and got confused about the charge that appeared on his credit card. So instead of calling me he just called his credit card and started a chargeback. I contacted Paypal, and it is against the terms of service, but I am the one who is right now out $275.00 until this is resolved.

    I am really frustrated with this case. I just thought I would throw my two cents into the mix.

    I get around 100 orders a month. We probably average about 5 of those that use Paypal each month. I have debated dropping them just because it is another step to get my money, and my merchant account is much easier to use.

    Burke

  4. #4
    Affiliate Manager PetsWarehouse.com's Avatar
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    I would protest that with PayPal, it is our clear understanding they can not do a charge back if you can prove delivery

    Henry
    Pet Dealer AM
    Look for our Private Forum at ABW soon!

  5. #5
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    I am protesting it with Paypal. The customer said he called his credit card to get it reversed, when he discovered his error! But it is still showing as pending on my reports page.

    Paypal wants the customer to fill out a Chargeback Waiver. This will clear it up faster, but you are relying on a customer to spend the time to help you. I honestly am worried about how long it is actually going to take to get my money.

    Burke

  6. #6
    Affiliate Manager frankodelic's Avatar
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    It doesn't seem to protect from fraud, because if someone is trying to perpetrate fraud they will ship to an unconfirmed address... then all seller protections are out the window.

    A chargeback can be disputed through your credit card as well if you show proof of delivery.

    The only see two benefits;

    The ability to pay by check, but there are other online check processing services out there that have got to be cheaper.

    Here's the one that smarts. We could possibly lose a sale? Someone may not feel comfortable transacting other than by PayPal.

    Ha... this sounds cheap, but what if we added a 1% service fee to process PayPal transactions.

    Am I missing something else here?

    Frank
    UrbanScooters.com
    UrbanScooters.com Affiliate Program

  7. #7
    Affiliate Manager PetsWarehouse.com's Avatar
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    You said <It doesn't seem to protect from fraud, because if someone is trying to perpetrate fraud they will ship to an unconfirmed address...>

    They can't, PayPal tells you if its confirmed or not. it is up to you to ship, or not.

    They can do a charge back easier with a standard CC then PayPal hands down.

    I think it's a good way to obtain orders and protect our interests.

    Henry
    Pet Dealer AM
    Look for our Private Forum at ABW soon!

  8. #8
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    Think you're mistaken pet dealer.. don't be so sure about that.

    ----
    -J
    The neighbors complain about the noises above

  9. #9
    Affiliate Manager PetsWarehouse.com's Avatar
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    In checking with our Paypal rep they can be quoted as follows; As long as we ship to a confimed address and can prove delivery of the product, the customer can not reverse the charge.
    I can add the accounting department here says that there have been no CB's to date.

    I'm only reporting our experiences.

    Henry
    Pet Dealer AM
    Look for our Private Forum at ABW soon!

  10. #10
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    Thumbs up Paypal Benefits and Drawbacks
    Paypal benefits:
    • Foreign currency acceptance,
    • Pay by check, solo, and debt cards,
    • Multiple card acceptance,
    • Interest on reserve funds,
    Paypal drawbacks:
    • Extra steps in sales process,
    • Account required for subscription / recurring,
    • Higher fees required,
    • No offline processing (without pro account),
    It all depends on what you are selling, who you are selling to, and where payments are coming from. At times I'm wondering if it's hurting conversion rates, but not sure. Overall, I've been satisfied with them.

    Best,

    Justin

  11. #11
    OOOPS just realized was an old POST, LOL GethsemeneRose's Avatar
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    Quote Originally Posted by hittjw
    Paypal benefits:
    [list][*]Foreign currency acceptance,[*]Pay by check, solo, and debt cards,[*]Multiple card acceptance,[*]Interest on reserve funds,

    Justin
    add to that Increased Customer Acceptance (ie more people trust PayPal than other services) If I were ordering something nowdays on the internet and they said buy via xyzpay I would say>>>??? who are they? no way!
    :gnome: [URL]www.gethsemenerose.com[/URL] :gnome: As for me and my SITE we shall serve the LORD!

  12. #12
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    Smile re: PayPal Benefits / Disadvantages
    Quote Originally Posted by GethsemeneRose
    add to that Increased Customer Acceptance (ie more people trust PayPal than other services)
    Are you saying that Paypal is more trusted over say; 2CheckOut, Clickbank, and other non-bank-merchant services?

    I really don't think users can tell they are being processed by Authorize.net or ECXCommerce or Bank of America -- so I can see that in the realm of third-party services Paypal be more recognizable.

    (I think I answered my own question from another post, since bank based merchant systems are transparent to the user, they require fewer steps and in turn should have less drop off.)

    Anyway, have a great weekend!

    Best,

    Justin

  13. #13
    OOOPS just realized was an old POST, LOL GethsemeneRose's Avatar
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    No i guess what I am saying is if it is NOT transparent (ie if there is a logo that says "Pay by PayPal" that is more comforting than a logo that says "Pay by flybynightbank.fiji.islands.net" ) as far as 2checkout or authorize I have really not heard much about either until recently so far I have heard nothing bad about any of them but I have also really heard nothing good. I have just heard NOTHING so I have NOTHING to base comparison on but I DO KNOW that most everyone on line Knows and Trusts PayPal (they may not like them but they trust them). Of course if the customer doesn't know who is behind the transaction he then just has to assume and hope it is good. I like having the PayPal Verified Sticker on my PayPal site it gives the customer more of a sense of security.)
    :gnome: [URL]www.gethsemenerose.com[/URL] :gnome: As for me and my SITE we shall serve the LORD!

  14. #14
    Newbie Brad1001's Avatar
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    Sadly, chargebacks are something which we have to live with, be it credit cards or paypal. I believe it ultimately boils down to the customer base, if your customers prefer the use of paypal then as merchants we have no choice to provide it, regardless of 1% or 2% more but if your merchant account is performing ok, then it is better to discard paypal and save up on this additional cost.

  15. #15
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    I'm fine with using paypal.
    Our customers feel safe knowing that WE do not have their CC# & only paypal does.
    Can you imagine if you gave your CC# to every seller/company on the internet?
    I'm still getting charged once a year, because I bought something off Ebay & they figure they will charge me every year & I might not notice. I have to call my CC & have it removed every year.
    Paypal is just more safe & easier for me.

  16. #16
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    Paypal and verisign just merged. There is now a lot of resistance in the merchant service industry regarding this merger. A lot of them are stopping to sell the verisgn gateway because Paypal is going after the merchant account. Also Paypal is dropping a lot of the higher risk merchants to clean up their portfolio.

    It might be well worth it to keep paypal for its international capabilities if you recieve a lot of sales from that and your regular MS provider doesn't do currency conversion.

    There are a lot of changes going on in the industry. Mastercard just IPO and went public with its interchange rates and VISA is doing likewise.

    Just remember the payment gateway you use needs to be CISP Compliant and it is what stores the CC info. Make sure you check for the compliancy.

    You will see many changes with PayPal over the next few months. If your doing the volume it might be in your best interest to move into a more traditional type of an account. Remember it isn't just about rate and price. Its about the ability to help you mitigate risk and make sure you are protected. Choose a provider for the quality of service not how much they are willing to discount their services. A few points more may end up being cheaper in the long run.

    Anna

  17. #17
    Newbie jaguarpolar's Avatar
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    I agree with Brad1001. Paypal OR credit cards, you're still gonna have to deal with chargebacks.

    Good thing about Paypal is that if you can provide your shipment's tracking number, they almost immediately drop the chargeback. But I think this is true as long as the funds come from the buyer's Paypal account and not through Paypal Unregistered. Paypal Unregistered = buyers can pay using credit card thru Paypal without signing up for a Paypal account.

    Another good thing about Paypal is that it accepts Checks/Bank transfer and it's a great option for customers who don't own a credit card.

    As a security measure, I usually send an e-mail to the customer's e-mail address registered to Paypal to ask for verification. Because if the account is being misused, the fraudster most likely wouldn't have access to the Paypal owner's e-mail account. And if the fraudster ADDED their own e-mail to paypal, a verification link would be sent to the primary e-mail address first before the add works. I think this is great 'supporting material' should there be a chargeback via Paypal.

  18. #18
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    I am a fan of paypal, they are there for both the seller and buyer. Like previously stated, always use tracking numbers, and you'll not likely lose a case.

    Also, have you looked into google checkout? Its my experience that users are reluctant with unfamiliar sites to give credit information directly to it. Paypal adds a layer of security and familiarity.

  19. #19
    Moderator MichaelColey's Avatar
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    One big warning with PayPal: Make sure you integrate it properly and test it thoroughly. As an affiliate, I've run into two problems with several merchants:

    1) If integrated wrong, it's possible for the customer payment to be sent to the merchant without the merchant checkout process being completed.

    2) If integrated wrong, affiliates don't get credit for PayPal orders.

    This same warning applies to ANYTHING special you do in your checkout process: Google Payments, rewards programs, etc.

    Test. Test. Test.
    Michael Coley
    Amazing-Bargains.com
     Affiliate Tips | Merchant Best Practices | Affiliate Friendly? | Couponing | CPA Networks? | ABW Tips | Activating Affiliates
    "Education is the most powerful weapon which you can use to change the world." Nelson Mandela

  20. #20
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    For those selling intangible services instead of products where you can show delivery, PayPal does not offer seller protection against chargebacks.

    Regarding higher fees, I think it would be a real turnoff for a customer to see that if they pay via PayPal they have to add 1%. Better just to include this cost in your overall pricing as a cost of doing business.
    [URL=http://themoneyforums.com]The Money Forums[/URL]

  21. #21
    ABW Ambassador 2busy's Avatar
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    If your product cannot be delivered in one week there is no seller protection either. I dropped PayPal in 2004 after I lost over $1500 to a fraudster (yes, I had proof of delivery) who claimed unauthorized use of his credit card - to order two custom made items with his name on them. Now I am back with PayPal because they bought Verisign and I have another year left on my contract. It is somewhat different with a Merchant Acct. and they seem to have changed somewhat as well, but I won't use PayPal for anything that can't ship within one week - no way.

  22. #22
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    We grudgingly accept paypal... pretty much because that's the only way you can sell on e'bay anymore, and e'bay is still one of our primary markets.

    We have encountered buyer-end fraud several times, and the fraudster is protected without recourse to the seller. Here's one way they do it:

    Buyer purchases item and pays through paypal. Seller ships and buyer receives item. Buyer then files a dispute that the item is not as described. BAM! Seller's money is taken away and placed on hold. Seller has a couple of options at this point. They can refund the money and the buyer keeps the item, or they can refund the money and the buyer must return the item. So, most sellers will opt for making the buyer return the item. Buyer sends a shipment to the seller, and once postal delivery confirmation verifies delivery, the buyer has their money back. Seller gets the shipment and can discover anything: a box of rocks, intentionally broken items (as happened to us), a similar item but not what was shipped to them in the first place, use your imagination.

    It's a buyer's world with e'bay and paypal, and the fraudsters know it.

    Seller Beware.

    Sara
    SiegeWork Creations

  23. #23
    Member 2sillycows's Avatar
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    As a person who makes purchases with paypal I will tell you that I have a couple hundred dollars every month where people pay me for ads, hosting and such. I do not send that money to my bank... I find things I like and spend it with paypal. That way it is not shown as income. There are a lot of people like me who have a couple hundred a month to spend using their paypal.

    What I really would like is if I could find someone who could sell me a wal-mart card or something that could be used natl. so I could buy gift cards and send them to my mother in Kansas. $200 is just change to me but that's a weeks income to some people.

    So if you don't have pp you won't get my business when I'm dumping my account. Any other time it doesn't matter.
    :kiss:

  24. #24
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    Paypal is safe and fast payment processor to use. Oftentimes it's the fees they are deducting in the amount that users complain about. I guess the sender should also know about it if they prefer payments on Paypal.

  25. #25
    Affiliate Manager
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    IMO PayPal is well worth the effort to provide as an option for your customers.

    The good folks here at ABW kept after me to add it to my WebMerge store, and I thought, "Why bother when we already accept credit cards?"

    Then I became a PayPal user, and discovered that there are two benefits to using it:

    1. It's simple
    I just type in my password and I can pay for anything in a single click. Nice.

    2. It feels like play money
    Since it's not tied to your checking account or credit card balance, there's a subtle feeling that you're not spending "real" money, making it that much easier to decide to buy.

    Since I added PayPal to my store my sales have gone up, and like some of the others here PayPal accounts for at least 10% of sales.

    Those who like PayPal like it a lot, enough that in some cases it may be the difference between deciding to purchase or move on.
    Richard Gaskin
    Developer of WebMerge: Publish any data feed on any site
    http://www.fourthworld.com

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