Ask HN: Why are PayPal fees larger than card processing?

#1

Post by valueprop » Wed, Mar 04, 2020, 9:08 PM UTC

Quoting from https://www.paypal.com/business/fees

If the funds you are receiving are coming from a PayPal account: then you pay: In the U.S. a fee of 3.7% of the transaction amount plus $0.30 USD. Outside Canada and the U.S. a fee of 3.9 % of the transaction amount plus a fixed fee based on the currency

I was expecting fees lower than Stripe when customers pay with their PayPal balance, and same as Stripe when paying with cards through PayPal.

How come PayPal is more expensive? Do they rely on customers preferring PayPal instead of sharing their card details with sites (even through it's in a Stripe popup, customers don't know about Stripe)

Re: Ask HN: Why are PayPal fees larger than card processing?

#2

Post by SamReidHughes » Thu, Mar 05, 2020, 1:52 AM UTC

That link doesn't work. At https://www.paypal.com/us/webapps/mpp/merchant-fees, I see 2.9% + $0.30, for in-U.S. transactions done in dollars.

Re: Ask HN: Why are PayPal fees larger than card processing?

#3

Post by [deleted] » Thu, Mar 05, 2020, 6:43 AM UTC

SamReidHughes wrote: post #2

That link doesn't work. At https://www.paypal.com/us/webapps/mpp/merchant-fees , I see 2.9% + $0.30, for in-U.S. transactions done in dollars.

[deleted]

Re: Ask HN: Why are PayPal fees larger than card processing?

#4

Post by valueprop » Thu, Mar 05, 2020, 6:45 AM UTC

SamReidHughes wrote: post #2

That link doesn't work. At https://www.paypal.com/us/webapps/mpp/merchant-fees , I see 2.9% + $0.30, for in-U.S. transactions done in dollars.

It did work yesterday... Here's another one: https://www.paypal.com/ca/business/fees

http://archive.is/JMuv3

Would this be applicable only to businesses in Canada?

Re: Ask HN: Why are PayPal fees larger than card processing?

#5

Post by SamReidHughes » Thu, Mar 05, 2020, 8:24 AM UTC

valueprop wrote: post #4

SamReidHughes wrote: post #2

That link doesn't work. At https://www.paypal.com/us/webapps/mpp/merchant-fees , I see 2.9% + $0.30, for in-U.S. transactions done in dollars.

It did work yesterday... Here's another one: https://www.paypal.com/ca/business/fees http://archive.is/JMuv3 Would this be applicable only to businesses in Canada?

There are higher cross-border fees in the U.S. too. I don't know how this compares to the competition.

Re: Ask HN: Why are PayPal fees larger than card processing?

#6

Post by jsumrall » Thu, Mar 05, 2020, 12:43 PM UTC

Just speculating, but maybe because PayPal can support lots of methods behind the scenes rather than you needing to support them, either with a PSP or otherwise.

Re: Ask HN: Why are PayPal fees larger than card processing?

#7

Post by javaIsGreat » Fri, Mar 06, 2020, 4:04 AM UTC

PayPal users can get added security/ease of use by not having to re-enter details in browser, so I assume that probably reduces the amount of customers from bailing on a purchase half way through inputing their payment details.

Thats value merchants pay for i guess