Rant: Dealers' pick and choosing PayPal and/or merchant services regulations

[Handlobraesing]

When a business sign up for a merchant service, including PayPal, they've agreed to abide by their terms and conditions and they're obliged to follow the rules, not pick and choose what's favorable for them.

PayPal related violations. Dealers passing on PayPal fees to buyers or splitting up payment destination depending on if the payment is balance/cash or credit. PayPal rules states that merchant can't surcharge the customer extra for using PayPal or direct them to different payment addresses dependent on payment method.

Cited from the latest PayPal user agrement. http://www.paypal.com/cgi-bin/webscr?cmd=xpt/ua/USUA-outside#receive-policy

1. 4.6 No Surcharges. You agree that you will not impose a surcharge or any other fee for accepting PayPal as a payment method. You may charge a handling fee in connection with the sale of goods or services, as long as the handling fee does not operate as a surcharge and is not higher than the handling fee you charge for non-PayPal transactions.
2. 4.7 No Splitting Payments. You may not split payments between a Personal Account and a Premier or Business Account by directing buyers paying with a credit card to send payments to your Premier or Business Account, and buyers paying with their Balance or bank account to send payments to your Personal Account. If you do so, we will charge you the Fees that would have applied to a Business or Premier Account.

Credit card related violations, such as "if paying by CC, add $x.xx"

VISA merchant regulation from VISA merchant handbook.

Always honor valid Visa cards, in your acceptance category, regardless of
the dollar amount of the purchase . Imposing minimum or maximum purchase
amounts is a violation .

No Surcharging

Always treat Visa transactions like any other transaction; that is, you may not impose any surcharge on a Visa transaction . You may, however, offer a discount for cash transactions, provided that the offer is clearly disclosed to customers and the cash price is presented as a discount from the standard price charged for all other forms of payment.

MasterCard merchant policy:

 

[zigziggityzoo]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

OK... so what's the difference between offering a discount for paying with cash and charging a surcharge for paying with a credit card?

I have a feeling you're directing this at local forum members who organize group buys. If you were organizing a group buy (which inherently is not for profit, especially after considering the time spent on the project), would you want to lose even more by accepting credit cards?

 

[Handlobraesing]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

OK... so what's the difference between offering a discount for paying with cash and charging a surcharge for paying with a credit card?

I have a feeling you're directing this at local forum members who organize group buys. If you were organizing a group buy (which inherently is not for profit, especially after considering the time spent on the project), would you want to lose even more by accepting credit cards?

Not directed for anyone in specific. Regardless, the rules does not make such exceptions.

The difference is similar to supermarket club card. The price you see on the tag is upfront value. If you present your card, you sometimes get a discount. Now, if the price tag was for member price, then you try to buy without a membership card and they try to charge MORE, does that feel the same to you?

If the price is advertised as "$6.50", it leads people into being able to buy it for $6.50. The merchant is then free to discount for cash and you can decide for yourself if you want to save a little by paying cash.

If the signage advertises "$6.25" and you're told "by the way, we're going to surcharge you for credit card" you've been mislead.

 

[LEDcandle]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

There have been numerous discussions on this; as zigziggity says, its a matter of wording.

Most of the time, when a person sells a light for $150, he wants to see the entire $150. So he says $150 by paypal cash, or add 4% with paypal CC. This irks the hell out of a lot of people.

He can actually just sell it for $156 flat, regardless of payment type, and those who could have paid paypal cash have to pay $6 more now because of the flat fee. Is it really better for everyone?

Ok, no doubt he could word it as $156 nett, $6 discount with paypal cash. But that would just be playing with words. Do we really need to be coddled like that?

1) $150 paypal cash, $150 + 4% paypal CC
2) $156 nett
3) $156 paypal CC, $150 - 4% paypal cash

Obviously 2 is the worst and 1 and 3 are the same!

 

[Handlobraesing]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

There have been numerous discussions on this; as zigziggity says, its a matter of wording.

Most of the time, when a person sells a light for $150, he wants to see the entire $150. So he says $150 by paypal cash, or add 4% with paypal CC. This irks the hell out of a lot of people.

If it's simply a matter of wording and it doesn't matter either way, they can list the advertised price as $156, then explain cash discouint in fine prints. If it's simply a matter of wording to be abiding, why chose the exhibit cash price, then explain surchage wording that's in violation?

The price tag affects buyer attraction, so merchants who thinks they should be excempt from policies chose to do what's favorable for them, not the buyer.

He can actually just sell it for $156 flat, regardless of payment type, and those who could have paid paypal cash have to pay $6 more now because of the flat fee. Is it really better for everyone?

Ok, no doubt he could word it as $156 nett, $6 discount with paypal cash. But that would just be playing with words. Do we really need to be coddled like that?

1) $150 paypal cash, $150 + 4% paypal CC
2) $156 nett
3) $156 paypal CC, $150 - 4% paypal cash

Obviously 2 is the worst and 1 and 3 are the same!

Accepting credit card would move a $300 product when the buyer wouldn't have been able to afford $300 in cash otherwise. The seller have the choice to accept the cost of business or lose that sale. Nobody is forcing them to accept credit card. They can either accept it in accordance with merchants' agreement or not accept it at all.

Would it be the same to you for a grocery store to offer a higher price tag and membership discount vs fine printed surcharge for non members on top of lower price tag?

 

[4sevens]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

Not directed for anyone in specific. Regardless, the rules does not make such exceptions.

Handlo, if you've read the rules for this sub-forum, it states that you should
try to work out your issues with others first before jeering. This requires
you to specify the person(s) you have a problem with. As you've stated,
you're not directing this toward anyone. It sounds more like whining to me.

If you have problems with a specific dealer, you should contact them in
private and if it's not resolved, then use this forum for what it's intended for.

I find your posts it quite hypocritical when you point to the specifics of
the letter of the law, yet you boast loudly in your sig line - a picture
encouraging duplication of keys that are prohibited from duplication.
(most government keys have this markings - warning key makers not to
duplicate without proper authority)

 

[Coop]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

Accepting credit card would move a $300 product when the buyer wouldn't have been able to afford $300 in cash otherwise.

And how is this a good thing? If someone can't afford an item in the first place, should they go into debt over it? If someone can't afford to buy an item $300 in cash, it seems to me that they have other things to worry about, instead of getting in debt over luxury items...

 

[LEDcandle]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

Would it be the same to you for a grocery store to offer a higher price tag and membership discount vs fine printed surcharge for non members on top of lower price tag?

Well, if the surcharge is hidden in fine print somewhere, then I'm with you. If it's like our typical CPF dealings where it is clearly stated upfront, then I think putting a surcharge or putting a higher price + cash discount is the same thing.

Of course, in a brick and mortar store, I wouldn't want to pay more upon reaching the counter. But if clearly states (pehaps big posters saying +8% tax, 2% CC surcharge), then I'd be mentally prepared for it. But of course, for the convenience of customers, the final nett price on the product is easier.

 

[Handlobraesing]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

And how is this a good thing? If someone can't afford an item in the first place, should they go into debt over it? If someone can't afford to buy an item $300 in cash, it seems to me that they have other things to worry about, instead of getting in debt over luxury items...

I think that's a matter of personal opinion. Most vehicles in US are financed and people tend to driver something nicer than they can afford in short term instead of buying something just adequate that they can afford to pay cash or pay off in a short term.

This is a good thing for ther dealership. Is this a good thing for the consumer? It depends on your point of view.

Well, if the surcharge is hidden in fine print somewhere, then I'm with you. If it's like our typical CPF dealings where it is clearly stated upfront, then I think putting a surcharge or putting a higher price + cash discount is the same thing.

Of course, in a brick and mortar store, I wouldn't want to pay more upon reaching the counter. But if clearly states (pehaps big posters saying +8% tax, 2% CC surcharge), then I'd be mentally prepared for it. But of course, for the convenience of customers, the final nett price on the product is easier.

There is going to be disagreements. I'm not speaking my opinion on whether this is allowed or not. I'm stating the rules set forth by VISA/MC and PayPal and citing where the data is from. I had nothing to do with the making of the rule.

 

[nikon]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

We've had this discussion several times before. The simplest solution is that if you don't like the seller's terms, don't buy what he's selling.

 

[shiftd]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

"... Nobody is forcing them to accept credit card. They can either accept it in accordance with merchants' agreement or not accept it at all. "

Likewise, nobody is forcing the buyer to accept the seller terms of pricing. If you dont like paying extra 3% or so, dont buy. simple as that.

Like nikon said, vote with your wallet.

 

[RAF_Groundcrew]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

Not directed for anyone in specific. Regardless, the rules does not make such exceptions.

The difference is similar to supermarket club card. The price you see on the tag is upfront value. If you present your card, you sometimes get a discount. Now, if the price tag was for member price, then you try to buy without a membership card and they try to charge MORE, does that feel the same to you?

If the price is advertised as "$6.50", it leads people into being able to buy it for $6.50. The merchant is then free to discount for cash and you can decide for yourself if you want to save a little by paying cash.

If the signage advertises "$6.25" and you're told "by the way, we're going to surcharge you for credit card" you've been mislead.

Actually, I find this amusing... I'm in Britain, and we currently have a 17.5% rate of VAT (sales tax), this applies to anything bought in the UK, whether in person or by mail. The total price at a store is displayed including sales tax, and that is what people expect to pay. When I was in the USA a couple of years ago, I was surprised to see many of the shelf prices did not include tax, this ws added at the checkout, something of an added 'surprise'.

I know that in the USA, out of state residents don't pay the sales tax on mail order purchases, but in a store, when one is more likely to buy on impulse, it increases the price you first see.

 

[frisco]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

I would guess the proper protocol would be to list the price inclusive of fees than give a cash discount. Simple! Than there would be snibbles about that!

frisco

 

[Handlobraesing]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

"... Nobody is forcing them to accept credit card. They can either accept it in accordance with merchants' agreement or not accept it at all. "

Likewise, nobody is forcing the buyer to accept the seller terms of pricing. If you dont like paying extra 3% or so, dont buy. simple as that.

Like nikon said, vote with your wallet.

The overwhelming difference is that they're signed a contract to not practice transaction in the described manner.

I fail to see this as justification for breaching contract they've signed(or e-signed) to abide. This practice isn't fair to consumers. It also gives them an unfair advantage over competitors that chose not to breach their merchant services' contract.

You as a cardholder is promised the acceptance of your valid VISA/MC at any merchant who chose to sign up to accept the card in acocrdance with card issuer merchants rule for any purchase amount without any merchant imposed fee. When merchant fabricates surcharges without having the right to do so by their contract, it affects your right as a card holder.

Actually, I find this amusing... I'm in Britain, and we currently have a 17.5% rate of VAT (sales tax), this applies to anything bought in the UK, whether in person or by mail. The total price at a store is displayed including sales tax, and that is what people expect to pay. When I was in the USA a couple of years ago, I was surprised to see many of the shelf prices did not include tax, this ws added at the checkout, something of an added 'surprise'.

I know that in the USA, out of state residents don't pay the sales tax on mail order purchases, but in a store, when one is more likely to buy on impulse, it increases the price you first see.

That's a matter of government imposed taxes between different countries and it is not part of the private contracts.

If you try to purchase something wtih your valid credit card and the merchant tries to charge you a surcharge, you say no, but if they argue, the best thing to do is let them charge it or ring it up to arbitrary minimum purchase they require and file a chargeback claim for the fraudulent charge with your credit card company.

 

[will]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

All credit card companies charge a fee to the merchant, some more than others. Any business is going to take that into account when pricing an object. I think most consumer based purchases are credit card based these days ( exception - large ticket items - houses, cars etc.). This is really a fact of life..

interesting topic - jeers should be be for a specific event, not a generalization. - how about a second jeers catagory for non specific stuff.

 

[Samoan]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

We've had this discussion several times before. The simplest solution is that if you don't like the seller's terms, don't buy what he's selling.

This is the part that I don't understand.

People complain about high shipping on EBay, PP by merchants and individuals, and adding insurance to packages.

I think I'm pretty sensible in just taking a look at the TOTAL PRICE and deciding if that's what I want to spend on something.

Right now I"m shopping for a new-to-me dSLR and I don't play the games that a lot of people do. If you don't post a price for shipping I'll probably not even look at your ad. Most on this forum seem to state a price including shipping CONUS.

 

[myk]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

I personally dislike added paypal fees for cc payments advertised in for sale threads, just because I've never charged anyone extra for paypal fees - I consider it a cost of doing business and therefore consider it in my overall offering price.

I also have a business account or whatever you call it, so I think I get charged a % no matter what the payment method? are they even different for bank account vs CC now?

oh well, personally I'd rather pay $2 to get the money NOW than wait 3 weeks while "the checks in the mail" just to have to spend $2 of gas to drive to the bank to deposit it


My one exception would be 0-profit group buys - to give each buyer the best price by their choice of payment method seems very fair to me

 

[Unforgiven]

This is a rant and does not comply with C&J rules.
Moved to cafe'

Unforgiven

 

[Samoan]

Re: Jeers: Dealers' pick and choosing PayPal and/or merchant services regulations

Duplicate post

 

[Glen C]

Handlo, not trying to be a pain in the butt, but that is not the law worldwide or even for Visa worldwide. The Australian government passed a law a while back which allows merchants to pass CC charges on. The intent was to discourage use of CC and make people aware of the cost of credit. I am unsure if that resulted.

I can see your point in posting this, though maybe an example would have made it clearer (though not as friendly).