If you are using Paypal for receiving store payments, or for paying your affiliates, you know the fees can be exorbitant. But did you know that Paypal offers different payment options, depending on the amount of the payment?
PayPal is a great option for many business owners that don’t want to go through the approval process for a merchant account, but the fees can really add up and squeeze margins that are already pretty tight in this rough economy. So here are some tips to put more cash in your pocket if you use PayPal.
The only time Paypal does not charge fees is when the money is being transferred from a Paypal balance, or directly from a bank account; any other time, the fees range from 1.9% to 2.9%, plus an addition 30 cents per transaction. Doesn’t sound like much until you start having large numbers of transactions; then these fees add up really quickly, and it gets sick to the point of causing indigestion.
Paypal now offers a different payment fee structure for payments made that are less than $12. Under their micropayment structure, Paypal has changed its fees to a total of 5% plus 5 cents per transaction for smaller payments, whereas payments over $12 will incur the smaller fees of 2.9% plus 30 cents per transaction.
Micropayments are only available to business or premier account holders in select countries. It also requires you to have 2 accounts: one for micropayments and one for macropayments.
The money you can save by taking advantage of micropayments with Paypal can add up. Many webmasters have saved between 11-13% per month, which is significant. Depending on the amount you are paying out, this can be a considerable amount of profits.
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