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I've had a number of clients request to pay us via PayPal which dont currently use.

Is anyone using PayPal for business for their practice? does it work and what costs are involved?


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By sqwint
18th Jun 2015 10:16

from the paypal site
Your monthly salesup to £1,500£1,500.01 - £6,000.00£6,000.01 - £15,000.00£15,000.01 - £55,000.00+£55,000Transaction fee3.4% + 20p2.9% + 20p*2.4% + 20p*1.9% + 20p*Call

0800 358 7929**

for pricing

so a £400.00 fee will cost 13.80 to collect it, plus there can be charges transferring the balance into your actual bank account. If you purchase stationery or printer ink from Ebay, the transfer fee can be avoided be spending from your paypal balance instead.


Depending on volume aside from the very occasional payment its probably cheaper to take on a merchant facility with a Bank or independent processor.



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18th Jun 2015 10:37


Personally, I'd only use it as a favour to a client.  And I'd expect them to stand the costs.

I do have a Paypal account - I've never used it to receive money and only have two or three payments a year from it.

Surprised you have "a number" of clients wanting to pay this way.

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18th Jun 2015 10:47


From experience it is pretty expensive to use for this purpose. Other credit card vendors / direct debit schemes are cheaper.

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By squay
18th Jun 2015 11:31

PayPal Flexibility

We do not pay a fee to transfer the net funds to our bank account. Paypal is handy for us because we only use it very occasionally where a client wishes to pay by card. As we use Xero we can add a link to our sales invoice which the client can pay in full using their Paypal account or by card which PayPal processes. Our sales invoices are emailed without the link as we ask for payment by bank transfer but we state other methods of payment are available if they contact us. Then we can issue a copy invoice with the link payment link attached. We have to absorb the cost but it does mean we get paid without having to process cheques or cash where the client doesn't have internet or telephone banking.

We sometimes have clients who want to pay by card but can only afford to pay in installments. The link on the invoice is all or nothing so we use the PayPal app on a smart phone to take card not present payments over the phone. We have the auto receipt emailed to us so we have a record and then forward it to the client.

We also have purchased a Paypal chip and pin card reader for clients who want to pay by card when they are in the office. The PayPal fees for processing using chip and pin are about 1% cheaper. Receipts are emailed as above but we can also print it out and give to the client.

In summarising PayPal is a bit expensive so we only use it on request for clients who cannot pay by bank transfer but wish to pay by card.  PayPal has no commitment, tie in contract or monthly charge so is ideal for the occasional user like us. It works well with Xero and the transactions are received via the "bank" feed automatically. We only we need one PayPal account but use it to receive card payments from a variety of methods; Xero invoices direct, card not present using smartphone app, chip and pin using reader connected to smartphone app. I have yet to find an alternative payment solution for occasional users which is so flexible.

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By Brunel
18th Jun 2015 18:15

Don't forget about the risk of charge backs as well.

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By happy
19th Jun 2015 11:30

I was going to add that too

Brunel wrote:

Don't forget about the risk of charge backs as well.

It's the main reason I wont use it together with the costs.

I now only accept payment by bank transfer and have no issues with it.

A few clients have asked to pay by PayPal but its never caused a problem that we only take payment by bank transfer.


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By adagen
19th Jun 2015 14:03

When things don't go well....

.... Worth looking at how effectively PayPal resolves problems when things go wrong, not just the cost of using it when everything is working well. And I don't think Paypal is regulated in the way that banks and credit card companies are.

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19th Jun 2015 16:32

As an option

have a look at intuitpay.  It is 2.75% and you can take payment over the phone.

When comparing costs we look at the cost of banking a cheque and the member of staff to do it.

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05th Aug 2015 17:13


One of my online retail clients moved from Paypal to Skrill insisting this is a better option.

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