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Paypal New policy changes (seems big) - summary ?

by EvcRo
11 replies
Got an email from Paypal about policy changes, i tried to read that 1km long page but i'm not sure i got it right.

1. Seems like at refund you (as seller) dont get back full transaction fee (like now)

2. Cross border fee - a new fee ? From what i read it does not apply to business accounts that sell stuff, i may be wrong.

3. A lot of other changes, if someone more experienced in this can shed some light over the important new aspects that concern business accounts (from seller pov) would be very nice.

As a result im starting to consider looking for a merchant account, any good recommends ? Or is strictly linked to the country you live in ?

Thanks.
#big #paypal #policy #summary
  • Profile picture of the author havplenty
    I haven't read the policy changes but judging by Paypal's past treatment of sellers, it wouldn't surprise me if we (sellers) end up with the "dirty (euphemism) end of the stick". They've recently announced surpassing the 100 million active users mark, and even went as far as to predict the the extinction of the wallet by 2015!

    2Checkout is not bad if you live outside of the developed countries but they have some pretty archaic practices (like phoning customers to verify transactions).

    Good luck anyhow.
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    • Profile picture of the author Dixiebelle
      Everyone has an occassional refund to issue, and I'm sure Paypal has a lot of them to issue everyday. They should be compensated for their work.

      If you don't have an excessive refund problem, then you shouldn't be concerned. If you do have one, it's a good indication that you need to improve your product.

      Happy 4th everyone!!!
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  • Profile picture of the author kindsvater
    This might be specific to your country.
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  • Profile picture of the author O0o0O
    Correct, I haven't received all of my money back from the few refunds I do get. I think this mainly has to do with the Rapid Action Profits API, although I'm not sure how.
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    • Profile picture of the author Sid Hale
      I can't believe I didn't see this before...

      Originally Posted by O0o0O View Post

      Correct, I haven't received all of my money back from the few refunds I do get. I think this mainly has to do with the Rapid Action Profits API, although I'm not sure how.
      Not only is this NOT mainly to do with Rapid Action Profits - it has NOTHING to do with Rapid Action Profits. (nor do I understand how you would infer anything of the sort)

      This is a change in Paypal's policy with regard to the reversal of fees in a refund situation, regardless of what software is used to initiate the payment transaction.

      FWIW - From my experience, the reversal of fees in the case of a refund appears to be somewhat discretionary on the part of Paypal. Since I experience refunds where they still reverse fees, I suspect that it is limited to the refund of payments where a credit card was used in the transaction (vs. debiting the buyer's Paypal balance), in order to offset the "real" expense charged by the credit card companies in the event of a chargeback.
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  • Profile picture of the author timpears
    My experience, which is long ago, with a merchant account is that you have a transaction fee when you initiate the transaction. There is a percentage and $0.30 usually. When you issue the refund and swipe the card again to credit it back, that transaction will cost you $0.30. Not a huge amount, but every little helps as the old lady said when she peed in the sea.

    I don't know what PayPal is keeping on the credit, but there is a cost to them for both sides of the transaction and you can't blame them for trying to recoup that money. Sucks, but that is the price of being in business I think.

    If this is a problem for you, then you are selling something that is not going over well and maybe you should stop selling it.
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    Tim Pears

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  • Profile picture of the author EvcRo
    Guys, i don't have problems with refunds, my refunds are under 0.3% per month , both as transactions numbers and cash volume.

    Problem is that a lot of changes to "Freezing" and the like sections + a lot of other things its enough to raise a few flags and determine at least the study of alternate paypal options.

    And, would like to hear some comments from people who really understand the key things under this huge policy changes page.
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    • Profile picture of the author CMartin
      I also received the email and what I noticed is the 180 days period for holding funds will be amended to... no specific period.

      The current User Agreement says this for "10.2 Actions by PayPal":
      10.2 Actions by PayPal. If we have reason to believe that you have engaged in any Restricted Activities, we may take various actions to protect PayPal, eBay, a User, a third party, or you from Reversals, Chargebacks, Claims, fees, fines, penalties and any other liability. The actions we may take include but are not limited to the following:
      ...
      h. We may hold your funds for up to 180 Days if reasonably needed to protect against the risk of liability; and
      The Amendment to the PayPal User Agreement (for Sep 07, 2011) does not mention any period of time for holding funds:
      Section 10.2h is amended to clarify that, in the circumstances as further set out in section 10.2, PayPal may hold funds to the extent and for so long as reasonably needed to protect against the risk of liability. A non-exhaustive guide to circumstances in which such risk of liability arises is also included. Section 10.2h now reads (set in the context of its root clause):

      "10.2 Actions by PayPal. If we have reason to believe that you have engaged in any Restricted Activities, we may take various actions to protect PayPal, eBay, a User, a third party, or you from Reversals, Chargebacks, Claims, fees, fines, penalties and any other liability. The actions we may take include but are not limited to the following:
      ...

      h. We may hold your funds to the extent and for so long as reasonably needed to protect against the risk of liability. You acknowledge that, as a non-exhaustive guide:

      i. PayPal's risk of liability in respect of card-funded payments that you receive can last until the risk of a Chargeback closing in favour of the payer/buyer (as determined by card scheme rules) has passed. This depends on certain factors, including, without limitation:

      a. The type of goods or services for which you receive payment; or

      b. The timeframe for delivery of the goods or performance of the services for which you receive payment (e.g. sales of event tickets months in advance of the event date can present a higher and more enduring risk of Chargebacks than sales of most other items or services);
      ii. PayPal's risk of liability in respect of a Claim or Dispute arising from a payment that you receive can last for the time that it takes for the parties to close the Claim or Dispute and all appeals associated with that Claim or Dispute in accordance with section 13 of this Agreement;

      iii. PayPal's risk of liability in respect of any event of insolvency that you suffer can last for as long as and to the extent that laws applicable to your insolvency restrict PayPal from taking legal action against you; and

      iv. If you allow your Account to have a balance reflecting an amount owing to PayPal, PayPal's risk of liability can last for the time and to the extent that you owe that amount to PayPal."
      Does this update to Section 10.2h (without any mention of time and with the use of "You acknowledge that, as a non-exhaustive guide") allows them to invoke other reasons and hold funds for as long as they want?

      Please someone "translate" this :confused:

      Thanks,
      Carlos
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  • Profile picture of the author EvcRo
    Thanks, this is what i want, a discussion over the many changes, so we understand what to expect from Paypal.

    Any comparison between new fee structure and the current one ? From a business account pov there seems no changes.
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  • Profile picture of the author PhilG
    I tend to agree with those who have pointed out that credit cards have had these charges for some time now, and it was only a matter of time before PayPal started charging them.

    In fact, credit cards have some very onerous fees. A church site that I look after was receiving fraudulent donations for some jerk in India for $1 each. We received hundreds of them. Then the real owners of the credit cards would initiate a fraudulent transaction report with their bank. It cost us $35 EACH if we did not respond within a certain period of time. It was an incredible hassle for a $1 transaction.

    I have recently noticed a number of transactions on an eCommerce site of my own where someone has cracked the PayPal button code and enters 1 cent as the purchase price. These new rules could make that an expensive proposition as well. I am going to have to figure out how they are doing that and get it changed.

    Just my 2 cents
    Phil G
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  • Profile picture of the author Gary Ning Lo
    I live in a developing country and use 2checkout.

    Up to now no major issues.

    Cheers,

    ~Gary
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