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.

[digital*ghost]

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@scrapthatidea_1 wrote:

How does this math not make sense?

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If PayPal still refunded the 30c component back to the buyer when you issued your refund, only the $2.76 you received would come back out of your account, because they would give back 38c so receiving the payment and issuing the refund used to cost you nothing. They don't give back the 30c part, so you're down 30c at the end of the day, not 60c.

Look at it this way - your balance is $1.00. You receive the $2.76, so now your balance is $3.76. You refund the buyer, $3.06 coming from you. $3.76 - $3.06 leaves a balance of 70c. Total cost to you is 30c.

[amber-eyed-girl]

This is the kind of math I used to hustle with 🙂

back at school

digi...you have explained it well 🙂

[digital*ghost]

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@amber-eyed-girl wrote:

This is the kind of math I used to hustle with 🙂

back at school

digi...you have explained it well 🙂

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I did actually have to think about it for a minute, because at first glance it does look like you pay the 30c twice, but when you balance the sums it's (hopefuly) clearer to see that the entire transaction leaves you 30c poorer. 

[daniellebradydesigns]

Your maths in incorrect. You are only out of pocket 0.30c.

This reminds me of those problems back in school.

John has 50 chocolate bars. He eats 45. What does John have now?

Diabetes. I'm pretty sure John has diabetes.

[scrapthatidea_1]

I think everyone is missing the point here, it doesn't matter whether it is  $2 or .05c each time, if we refund the money back to the customer and Paypal keeps a portion of it we should know that it is costing us.

Since it is a recent change to Paypal policy, a lot of people were not aware they lose out every time, it is especially confusing because when I checked it on Paypal it clearly says, "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."  and this is not the case.

I have around 40 of these every day, I am sure I am not the only one, it adds up fast.

[daniellebradydesigns]

Actually it is stated on PayPal's website:

"When you issue a full refund, your original transaction fee is credited back to you minus a thirty cent processing fee. When issuing partial refunds, a portion of the fee is returned to you."

No one is missing the point. People are aware of this. It has been this way for a while. It's not that new. I think people are just confused by your mathematics.

To be honest I don't have an issue with PayPal retaining the 'processing fee'... Either way they still have to process the payment whether you refund someone or not.

I'd be more concerned about you needing to refund 40 people a day?

[digital*ghost]

The refund isn't what is costing you the money, it's the fee to receive it, which you now pay whether you refund or not, whereas before you only paid it if you kept the money.

[green-gifts-mkd]

"If you issue a full refund using the Issue Refund link, PayPal automatically refunds all the original transaction fees."

Yes, but if you read more closely, you will find that you will be refunded the 2.4% transaction fee but not the base fee of $0.30, which PayPal retains for having processed the payment the first time.

3.14- (buyer's original payment)
  .38   (.38 charged by PayPal)
------ =
2.76-  (total to your account)
3.06   (paypal returns 3.06 out of buyer's original payment and .08 of their funds to buyer = $3.14)
------ =
-0.30  (you have lost .30 base fee)
------

It's confusing, I know. I used to be a Maths teacher. But each refund is costing you one lot of $0.30.

I think you are being too kind to a customer like this, just because they don't read or don't know how to use the cart, or don't know how to buy, buy, buy etc, then check their 'Purchase History' or wait for an invoice to pay.

I have had this happen and have posted together anyway with SoD. It's a risk in a number of ways but you are costing yourself time and money (it also perpetuates the idea that buyers don't have to think and sellers will mop up the pieces for them).

Also, I would block them. If they really want to buy again, they'll contact you and you can ask them what they're after and explain how to go about it!

I know selling as much as possible is the zenith for a serious eBay business but how much silliness from buyers should we be accommodating? 6 separate payments of $3.14...and you say some people do as many as 20? Ridiculous!

[clarry100]

When buyers buy multiple items from us 90% dont know how to combine their purchase into a single PayPal transaction. They just pay each one individually as they bumble along.

All the while each additional transaction is costing us an extra 30-cents.

These buyers are normally low FB score but not always. Some ought to know better!

It's an education thing, they just dont have a clue. And of course PayPal/eBay will not do anyhting to stop it as they are reaping the rewards. How many extra tens of thousands are they collecting this way?

So... I put forward an idea on here a while back that new accounts should have to go thru some kind of online tutor course, maybe 30-minutes, that teaches them how to use ebay, and some buyer etiquette (bit like train etiquette, simple stuff). And you have to tag each page as read (with a time frame sufficient to actually look at the page) in order to get your account to be active. Not hard for ebay to setup and implement.

And then if they get too many non-payer strikes they have to go back thru the tutor course once again to reactivate their account.

But would they implement something like this? I think not.

[scrapthatidea_1]

It concerns me too that there is so many people that don't read the multiple requests to wait for a combined invoice.

This is the link to Paypal where I got my information https://www.paypal.com/au/webapps/helpcenter/helphub/article/?articleID=FAQ1252&m=SRE where is actually 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."