WARNING! Paypal now charges you to send a refund!

[scrapthatidea_1]

I want to make sure everyone knows now about Ebay/Paypals newest moneygrabbing scam. 

Due to eBays method of shoving people straight to Paypal every time they buy an item I end up with some customers making multiple purchases and paying separate postage costs for each item(sometimes up to 20 items).  

I dont like overcharging people so I usually refund all of the separate purchases and send a new, combined invoice with the correct postage on it.

On the Paypal website it clearly states, 

"If you issue a full refund using the Issue Refund link, PayPal automatically refunds all the original transaction fees. If you send a partial refund, PayPal refunds part of the fees, based on the refund amount."

Now, when I go to do the refunds I am being charged for it.

Here is an example from today...

A customer has ordered 6 ribbons from me and paid 6 times including 6 postage charges. I wanted to refund the payments and combine them onto one invoice to save them $$ on postage and me some $$ on fees.

The buyer pays $3.14 for each transaction. Paypal keeps .38c in fees and I get $2.76 of this amount but when I try to refund it $3.06 comes from me and only .08c is refunded from Paypal, so out of the $2.76 I was left with when they took their 1st bite from it I have to refund the customer $3.06 and Paypal only refunds .08c.

This refund ends up costing me .60c in fees per transaction. I have around 40 of these every day, it adds up fast when you sell such small items.

I called Paypal and they said they have changed their policy in Feb so it just tough luck for me(even though they havent adjusted the website). 

I have a header on every store page and clearly state in every listing to wait for a combined invoices so dont know what else to do to avoid these fees, the customers that dont read the listings are usually the same ones that go ahead and leave negs and abuse us about being overcharged for postage - I cant win.

[scrapthatidea_1]

I agree, a lot of people just don't know better but there is still a large percentage that do know better(incl people I have messaged a few times and explained it).
When you are using the app to buy, it pushes you straight through to pay. There needs to be some kind of 'Continue Shopping' link or a message to let customers know if they are buying multiple items they can request combined postage.

[pruetrading]

With multiple separate payments, I've just started telling buyers that I can send it cheaper by combining postage, and that it will be XXX anount for postage & packaging, + the fees that Paypal charge me to refund them. No-one has complained yet. Sometimes I self-insure with extra cover or SOD, as Paypal protection is invalidated. 

I've heard that Paypal can sanction a seller's account if they are doing a high number of refunds, so you may need to be careful 

[onlinecoinslismore]

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@scrapthatidea_1 wrote:
I agree, a lot of people just don't know better but there is still a large percentage that do know better(incl people I have messaged a few times and explained it).
When you are using the app to buy, it pushes you straight through to pay. There needs to be some kind of 'Continue Shopping' link or a message to let customers know if they are buying multiple items they can request combined postage.

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Other problem we are finding is that it wont combine items with different shipping methods. So if a buyer orders say 10 items, with the standard shipping method being either APP, Courier or Parcel Post Stachel etc. It process / combines only the items with the same shipping method and hence sometimes 3 payments for the one order, Customers then get confused as to why their order comes in 2 separate methods.

Anothre ebay fail.

[ozstockman]

The OP is right, paypal has changed the way it processes refunds and now sellers are out of pocket and Paypal is getting reacher. They do refund fixed fee not but they keep their 2.4%. It's just outrageous.

Here is an example from Paypal website

1. We have inserted new examples in clauses 19.6 and 19.7:
   
   “19.6 Example 5 – Full refund of a Commercial Transaction payment

   The following is an example of the refund fee for a full refund of a Commercial Transaction payment from a buyer in Australia:

   1. Amount from the buyer: $100 AUD
   2. Seller will receive: $97.30 AUD ($100 AUD less $2.40 AUD variable fee and $0.30 fixed fee)
   3. 100% refund, buyer will receive: $100 AUD
   4. Seller will be debited: $97.60 AUD (the amount initially credited to your account $97.30 AUD plus the $0.30 fixed fee)

   19.7 Example 6 – Partial refund of a Commercial Transaction payment

   The following is an example of the refund fee for a partial refund of a Commercial Transaction payment from a buyer in Australia:

1. Amount sent: $100 AUD
2. Seller will receive: $97.30 AUD ($100 AUD less $2.40 AUD variable fee and $0.30 fixed fee)
3. 50% refund, buyer will receive: $50 AUD
4. Seller will be debited: $48.80 AUD [$48.65 AUD (50% of the amount initially credited to your account) plus $0.15 (50% of the $0.30 fixed fee)]

https://www.paypal.com/webapps/mpp/ua/upcoming-policies-full

Now we all have to explain our customers that they can demand their 2.4% from Paypal only and stop processing refunds as an actual refund through Paypal. Actually you cannot  use Paypal now for sending a refund  as a payment back because our buyers will be charged on receiveing it. So the only way to refund is to send it via bank deposit the amount less paypal fees.

[digital*ghost]

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@ozstockman wrote:

Now we all have to explain our customers that they can demand their 2.4% from Paypal only and stop processing refunds as an actual refund through Paypal. Actually you cannot  use Paypal now for sending a refund  as a payment back because our buyers will be charged on receiveing it. So the only way to refund is to send it via bank deposit the amount less paypal fees.

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It does not cost the buyer anything to receive the refund, and PayPal do not keep the 2.4% unless the seller keeps the payment. If a buyer pays $100, they receive $100 back from a refund, the only charge, anywhere, is the 30c transaction fee charged to the seller, which they have to pay to receive the funds, and is now non-refundable.

If you don't use the 'Refund' function from the transaction, then sending the buyer funds can cost them money, depending on what you send it for, and how it's funded, but a direct refund means buyer gets 100% back, PayPal keeps 30c, seller is out 30c.

[ozstockman]

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@digital*ghost wrote:

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@ozstockman wrote:

Now we all have to explain our customers that they can demand their 2.4% from Paypal only and stop processing refunds as an actual refund through Paypal. Actually you cannot  use Paypal now for sending a refund  as a payment back because our buyers will be charged on receiveing it. So the only way to refund is to send it via bank deposit the amount less paypal fees.

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It does not cost the buyer anything to receive the refund, and PayPal do not keep the 2.4% unless the seller keeps the payment. If a buyer pays $100, they receive $100 back from a refund, the only charge, anywhere, is the 30c transaction fee charged to the seller, which they have to pay to receive the funds, and is now non-refundable.

If you don't use the 'Refund' function from the transaction, then sending the buyer funds can cost them money, depending on what you send it for, and how it's funded, but a direct refund means buyer gets 100% back, PayPal keeps 30c, seller is out 30c.

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Sorry mate, you are just wrong.

First of all I posted an example from Paypal website, have you read it? They refund only 0.30c but not 2.4% fee. It is in place since  25.02.14 according to their policy update.

Second of all, here is a real life example: one of my buyers who bought and paid for one of my items yesterday asked me to cancel it.  She just did not read the item description at all and thought she can get whatever she wanted for the minimum listed price. The item total  was $13.93 and I received only $13.30 after all fees paid to paypal. I cancelled it through ebay and she confirmed it right after I made a first post in this thread.

So it was $0.63 in fees($0.3 for the fixed fee and $0.33 is paypal 2.4% fee). However when I tried to refund it in full Paypal told me that they would refund only $0.30 and I would have to pay $13.63(pls note that I received only $13.30). So it is me as a seller who must refund $0.33.

[digital*ghost]

I think you need to read your example again. 

19.6 Example 5 – Full refund of a Commercial Transaction payment

The following is an example of the refund fee for a full refund of a Commercial Transaction payment from a buyer in Australia:

1. Amount from the buyer: $100 AUD
2. Seller will receive: $97.30 AUD ($100 AUD less $2.40 AUD variable fee and $0.30 fixed fee)
3. 100% refund, buyer will receive: $100 AUD
4. Seller will be debited: $97.60 AUD (the amount initially credited to your account $97.30 AUD plus the $0.30 fixed fee)

That clearly shows that the seller is only paying $97.60 of a $100 refund, and that the buyer receives $100. The extra $2.40 (2.4%) doesn't come out of thin air - PayPal refunds it to the buyer.

[ozstockman]

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@ozstockman wrote:

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@digital*ghost wrote:

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@ozstockman wrote:

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Sorry mate, you are just wrong.

First of all I posted an example from Paypal website, have you read it? They refund only 0.30c but not 2.4% fee. It is in place since  25.02.14 according to their policy update.

Second of all, here is a real life example: one of my buyers who bought and paid for one of my items yesterday asked me to cancel it.  She just did not read the item description at all and thought she can get whatever she wanted for the minimum listed price. The item total  was $13.93 and I received only $13.30 after all fees paid to paypal. I cancelled it through ebay and she confirmed it right after I made a first post in this thread.

So it was $0.63 in fees($0.3 for the fixed fee and $0.33 is paypal 2.4% fee). However when I tried to refund it in full Paypal told me that they would refund only $0.30 and I would have to pay $13.63(pls note that I received only $13.30). So it is me as a seller who must refund $0.33.

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Actually it seems I am wrong based on the processed refund. They did refund 2.4% but they kept $0.30. It did not look this way before processing the refund but after it's processed I can see that Paypal refunded 2.4% portion. My appologies to digital*ghost.

It is still unfair that we as sellers have to pay even $0.30 for the buyers who do not care to read item descriptions and ask to cancel ebay sales because of it but at least it is a small fee to pay. 

[digital*ghost]

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@ozstockman wrote:

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Actually it seems I am wrong based on the processed refund. They did refund 2.4% but they kept $0.30. It did not look this way before processing the refund but after it's processed I can see that Paypal refunded 2.4% portion. My appologies to digital*ghost.

It is still unfair that we as sellers have to pay even $0.30 for the buyers who do not care to read item descriptions and ask to cancel ebay sales because of it but at least it is a small fee to pay. 

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It's all good, I know all things considered that it's easier to believe the worst of certain companies. 😄

The only thing you can really do is issue a refund less any costs incurred in cases where the buyer has changed their mind, though unfortunately there will always be a few that might take exception to that.

I don't often get people asking to cancel after a payment has been made, but I do get request to combine postage after multiple payments have been made. But I have flat rate postage for people who make one payment (that is, all additional items post for free after the first P&H charge), and that offer is predicated on them making one payment, because most of the time combined postage is a bit higher than my current flat rate and I'm only prepared to absorb it if a single payment is made, so if I combine postage for buyers after they've made separate payments, technically they don't qualify for this offer and I only refund the actual excess postage, which is always a bit less than what would have been saved by my auto-combine rates (meaning, they can still save, but not at my expense). 

[*crikey*mate*]

so don't cancel the sales?