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When to Use PayPal vs. Merchant Account

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Re: When to Use PayPal vs. Merchant Account

#11

Post by jeffmould »

pitdesi wrote: post #8
jeffmould wrote: post #6

Earlier quoted context omitted.

Yeah, the website also does not take into account monthly fees if you have PayPal Premium (or whatever it is called) account, which I would assume most larger volume merchants are paying.

It actually does take that into account... click on "more options"

Didn't see the "More Options" link, so sorry I offended you. My statement is still correct in that if you add a Pro account to PayPal, the merchant account becomes the cheaper option in most cases. Also, I would be willing to bet that most merchants who process high transaction size and high volume with PayPal are using Pro accounts.

Re: When to Use PayPal vs. Merchant Account

#12

Post by YooLi »

Hmm... So if I want to have $0.99 payments, it will cost me 32% to go with paypal or 26% to go with setting up my own merchant account, and both are only for domestic payments.

Suddenly Apple's 30% for payments from ~100 countries sounds like a bargain.

Re: When to Use PayPal vs. Merchant Account

#13

Post by pitdesi »

jeffmould wrote: post #11
pitdesi wrote: post #8

Earlier quoted context omitted.

It actually does take that into account... click on "more options"

Didn't see the "More Options" link, so sorry I offended you. My statement is still correct in that if you add a Pro account to PayPal, the merchant account becomes the cheaper option in most cases. Also, I would be willing to bet that most merchants who process high transaction size and high volume with PayPal are using Pro accounts.

That's totally correct, no offense taken, just wanted to make sure you saw that we'd included it!

You are totally correct that for merchants that process decent volumes, a merchant account is usually the better bet.

Re: When to Use PayPal vs. Merchant Account

#14

Post by JCB_K »

This doesn't take your market into account. For example, my Dutch debit card isn't compatible with international credit-card numbers. My paypal-account is directly connected to my bank account (direct debit), so it practically works like a credit card, but I can only use it online. This means that I'll only order stuff at websites which support Paypal.

Re: When to Use PayPal vs. Merchant Account

#15

Post by pitdesi »

YooLi wrote: post #12

Hmm... So if I want to have $0.99 payments, it will cost me 32% to go with paypal or 26% to go with setting up my own merchant account, and both are only for domestic payments. Suddenly Apple's 30% for payments from ~100 countries sounds like a bargain.

That's true for $0.99 app purchases. Apple has a lot of power in that they can pool the transactions and actually charge your credit card not for $0.99, but for all your purchases over a certain time period. This is something an individual app maker couldn't do and makes perfect sense for Apple to do.

Where I think Apple is egregious is in their subscription pricing... for example, 30% is a lot to take on a $15 kindle book or $8 netflix subscription

Re: When to Use PayPal vs. Merchant Account

#16

Post by sammcd »

I like the site and think its helpful.

I have to say it isn't for my case though. I'm using Paypal's website payments pro for my current app, and that comes with a monthly fee not factored here.

Also when I looked at using a real merchant account, these fees vary greatly and no one I was looking at was as cheap as 1.8. All the merchants I looked at were more expensive than Paypal percentage wise. I also feel like this doesn't account for some batch fees I saw.

Not to mention that many times with merchant accounts you are paying a merchant fee and a gateway fee.

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