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I thought it might be helpful for all of us if we have a FAQ ("Frequently Asked Questions") available for everyone. Our full fee schedule - located at www.paypal.com/fees - is an excellent summary of our fees and how they work, but it's still beneficial for all of us to discuss it here in the forums. Our team will be monitoring and updating this thread as we see questions trend. If you see something you think would be good to have in this FAQ, please don't hesitate to let a moderator know!
Before we go any further, let's discuss a little about how the basic fee structure in PayPal works. Please note this information is intended for US accounts receiving payments via Website Payments Standard or Send Money. Our fees are the same regardless of your account type, be it Personal, Premier, or Business. We charge fees in a few basic scenarios:
Fees for receiving a payment are calculated by adding two things together: a fixed fee and a percentage fee. The fixed fee involves no math on it's own - it's thirty cents.
If you are receiving a payment from someone from outside of your own registered country or region, add 1% to the percentage fee portion (so it would then be 2.9% to 3.9%). This extra 1% is known as a Cross-Border Fee.
Putting all that together, that means we calculate your fee by first taking a percentage of the payment you received and then adding thirty cents. Lets look at two examples:
Example 1: You live in the US, and a buyer who also lives in the US sends you a payment for $100. Your fee would be 2.9% plus $0.30 USD, or $3.20 USD.
Example 2: Now let's move the buyer to say, Madagascar (or anywhere else outside of the US). Your fee now has an extra 1% - the cross border fee is now applied - becoming 3.9% plus $0.30 USD, or $.20. This is known as a cross-border fee.
PayPal will apply your fee by simply deducting it out of the payment when it is received; we won't send you a bill in the mail every month.
We'll post the FAQ below, so if you have suggestions, please don't hesitate to ask!
Fees: Frequently Asked Questions
Question: I received $15 but my balance only went up $14.26. Where's the rest of my money?
Answer: When you receive a purchase payment with PayPal, there is a fee that is deducted out of the payment. That fee is typically 2.9% plus $0.30 USD.
Question: My buyer sent me a payment with his bank account or his balance. Why did I pay a fee?
Answer: If another individual is purchasing something from you, this transaction is considered a purchase payment, and fees are assessed regardless of the funding source the buyer used.
Question: I received a payment for $1 and PayPal charged me a 33% fee. I thought the fees were 2.9%.
Answer: You were assessed a 2.9% plus $0.30 USD fee. If you only received a dollar, the 2.9% portion of your fee would equal 3 cents. We would then add 30 cents to the 3 cents, for a total of 33 cents. If your payments are generally $14 or less, you may consider applying for our Micropayments rate so that you can retain a greater portion of your payments. Micropayments charges a lower fixed fee, which significantly reduces the amount of fees you pay on smaller payments.
Question: I thought we paid a 4.9% fee on credit card payments if you had a Personal account?
Answer: In the past, PayPal did charge different fees for different account types. Now, all accounts share the same fee schedule - see www.paypal.com/fees.
Question: I received $10, but PayPal took $0.69. That's almost a 4% fee, not 2.9%.
Answer: You were assessed a 3.9% plus $0.30 USD fee, which indicates the other person who sent you money is not located in the same country or region as you are. When the other party is in a different country or region than you, the percentage portion of the fee is increased by 1%. This is known as a cross-border fee.
Question: I received a payment for $5,000 USD but you still charged me 2.9% plus $0.30 USD. I thought I received a discount automatically.
Answer: In order to qualify for a lower fee rate, you must first apply and be approved for our Merchant Rate before receiving the payment.
Question: I received two payments of $10.00. Paypal took a fee of $0.59 on one transaction and $0.69 on the other one. Why is there a difference on two payments that are generally the same?
Answer: The difference in fees here indicates that one payment was from someone outside of your country, and the other one was not. In that scenario, an additional 1% fee will apply, thus the difference. This is known as a cross-border fee.