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Personal Paypal payments for purchases and payers paying Paypal fees prohibited.


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#1 shrike4242

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Posted 26 January 2010 - 10:25 PM

Recently, there's been a trend to send Personal Paypal payments as a gift to other CAGs for the purchase of items. This is done to prevent the charging of fees to the recipient for the Paypal payment. Unfortunately, this is against Paypal's User Agreement, in section 8, under Fees.

Paypal User Agreement:
https://cms.paypal.c...&locale.x=en_US

Specifically:

Fees are based on whether you are making a Purchase Payment or a Personal Payment.

A Purchase Payment is a payment received for any of the following:

  • A sale of goods or services (a “Commercial Transaction”);
  • A payment you received after using the “Request Money” tab on the PayPal website;
  • A payment you received for a donation; or
  • A payment that is sent to, or received by, a business or other commercial or non-profit entity.
A Personal Payment is:

  • Amounts sent to a friend or family member without a purchase. Personal Payments include, but are not limited to, sending a gift to a friend, or paying a friend back for your share of a lunch bill; and
  • Personal Payments must be sent between two individual persons (not to or from a business).
For Purchase Payments, the recipient of the payment will always pay the fee.

For Personal Payments, the following applies:
-The fee is based on the Payment Method,
-It is free to send a Personal Payment to someone in the United States if you use your bank or balance as the exclusive Payment Method*. All other Personal Payments include a fee as noted below.
-The fee is paid by either the sender or recipient. Not both.
-The sender of the payment determines who pays the fee. At the time the sender is completing the payment, the sender is given the option to either pay the fee or have the recipient pay the fee.

Additional fees apply if you are sending or receiving money to or from a country outside the United States, or transacting in a foreign currency.
If you use your credit card as the Payment Method for a Personal Payment, you may be charged a cash-advance fee by your credit card company.
*In some instances, Personal Payment pricing may not be available, the payment will be considered a Purchase Payment and the Purchase Payment fees shall apply. This may occur on non-PayPal websites that offer you the ability to send a payment from your PayPal account.


If you're making a purchase for an item, the payment has to be sent as a Purchase payment and not a Personal payment. If a payment is sent for a purchase as a Personal payment, Paypal won't do anything for dealing with a chargeback, so it's for the sender's protection to make sure payments are sent as Purchase payments. If you file a dispute with Paypal over a purchase and the payment is a Personal payment, they won't do anything to resolve it.

Paypal fees are easy to calculate, and there's a number of website that show both sides of the transactions for money sent and money received. One I used to frequently (http://www.rolbe.com/paypal.htm)is no longer online due to the owner passing away. Try using one of these instead:

http://thefeecalculator.com/
http://www.gregledet.net/ppfcm.html
http://salecalc.com/paypal

It shows how much needs to be sent to have the recipient receive a certain amount of money, as well as how much the recipient will receive and how much the Paypal fees are.

In the negotiations for the price of an item or items, please work out who should pay the Paypal fees in working out the terms of the deal, though Paypal obviously collects the fee off the recipient's side of the transaction. The Paypal calculator site above is very easy to see how much the sender should be sending to have the recipient net out an amount after fees.

There's also other payment methods that can be used in lieu of Paypal, as well.

EDIT:
As we've gone through the user agreement multiple on the Personal Payment issue, it was brought up again that the payee on Paypal payments can't surcharge for the use of Paypal fees on the payer. The payee pays the fees on Paypal for Purchase payments.

No surcharge section of the Paypal UA:

4.5 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.


You cannot explicitly charge Paypal fees as a surcharge for a transaction. If the price for the item is listed, it can't have Paypal fees added as a surcharge. Payees pay the fees with Paypal and it can't be explicitly added to a purchase cost.

EDIT - Addendum about Amazon Payments:

For people that would rather not deal with Paypal, Amazon offers a similar service with Amazon Payments:
https://payments.ama.../sdui/index.htm

EDIT - Addendum about Steam multi-packs and PSN gameshares:

I've contacted both Paypal and Steam about the gift payment and gifting of games (Steam has a thing about extra copies not being able to be sold).

Paypal

Thank you for contacting PayPal.

Hi, my name is Sonny. I appreciate you sending us an email regarding
your concern and I will be happy to assist you with your questions. Let
me explain this further.

Since the payments are coming from your friends, it is perfectly fine to
receive Personal payments. As long as the sender initiates the Personal
payment, you do not have to worry about your account because there will
be no restrictions.

Thanks for sharing your concerns with us. We value what you have to say.
If you have time, you can learn more about using PayPal by visiting
www.paypal.com/101.

Sincerely,
Sonny
PayPal Consumer Support
PayPal, an eBay Company

Original Message Follows:
------------------------
Form Message
customer subject: Does this qualify for use of personal payments?
customer message: Additional Information:
'I play lots of games on Steam and they have these 4-pack deals where you buy a game and it gives you one and 3 others to send to friends. I've been the one doing the up front purchase and they've been using Paypal Personal Payments to send the money they owe me for their part. Is that a use that qualifies for personal payments? I don't want to get my account or theirs locked out for improper use so before we do another one I wanted to get verification.'

Steam

I finally got a reply back from Steam:

Hello jp0213, Thank you for contacting Steam Support. This rule in the subscriber agreement is meant to prevent the abuse of this gifting system (i.e. user purchases a "copy" of left 4 dead from an online auction and instead gets a gift pass). We understand that friends or groups of people often go-in on four packs of subscriptions and will not automatically disable any of your accounts for it. If you have any further questions, please let us know - we will be happy to assist you.


Thank you for taking the time to check with Paypal and Steam, jp0213. Good fact to know that they consider Steam 4-packs to be worthy of Personal payments for "repayment" of the purchaser's copies of the game.

I think gameshares would probably work the same way to Paypal, since it's the same analogy of the up-front purchase of an item and the "repayment" to cover the share of the item, like the "repayment of lunch debt" analogy Paypal themselves use.


Edited by shrike4242, 05 October 2012 - 05:43 AM.
Added new Paypal fee calculator sites.


#2 Young Deezy

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Posted 26 January 2010 - 11:44 PM

Aww fo sho

#3 bvharris

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Posted 26 January 2010 - 11:45 PM

Alright, I guess I'll be the one to ask: Why the sudden concern with this? I think most people understand the risks of gifting payments, and it's always by mutual consent. Was there some sort of complaint from paypal?

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#4 Ryukahn

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Posted 26 January 2010 - 11:59 PM

This is a bummer. I too am curious as to why this is now an issue. Seeing this I'll have to reprice some of my items since I was listing them with the assumption that it would be paid via a gift payment.

#5 DAWG26

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Posted 27 January 2010 - 12:09 AM

I only do gift as payment with CAGs that Im comfortable with and have high feedback.

#6 MikeBastard

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Posted 27 January 2010 - 12:30 AM

Alright, I guess I'll be the one to ask: Why the sudden concern with this? I think most people understand the risks of gifting payments, and it's always by mutual consent. Was there some sort of complaint from paypal?


Shrike left a message in my thread where I was asking for gift paypal for a PS3. Of course I would have accepted non-gift paypal and it would have only been 8 bucks more for a close to $300 purchase. I can see not doing gift for that purchase, but it's annoying for an item that might only cost a few bucks. Oh well, rules are rules I suppose.
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#7 bvharris

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Posted 27 January 2010 - 12:35 AM

Shrike left a message in my thread where I was asking for gift paypal for a PS3. Of course I would have accepted non-gift paypal and it would have only been 8 bucks more for a close to $300 purchase. I can see not doing gift for that purchase, but it's annoying for an item that might only cost a few bucks. Oh well, rules are rules I suppose.


So we can blame you? :D

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#8 formerroadie

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Posted 27 January 2010 - 12:35 AM

time to start getting certs from amazon ;)

#9 Ryukahn

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Posted 27 January 2010 - 01:05 AM

Shrike left a message in my thread where I was asking for gift paypal for a PS3. Of course I would have accepted non-gift paypal and it would have only been 8 bucks more for a close to $300 purchase. I can see not doing gift for that purchase, but it's annoying for an item that might only cost a few bucks. Oh well, rules are rules I suppose.



Wow, you wanted people to gift you hundreds of dollars? lol

If people were actually wanting/expecting this then I can totally understand banning such payments here. I thought people only used it for when they were buying a game or something, at least that's the only time I expected gift payments. Sure as heck wouldn't expect people to do that for the DSi I have been trying to sell, heh.

#10 Bronson-Lee

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Posted 27 January 2010 - 01:19 AM

Paypal takes fees because they do the transaction, but they also protect the seller and the buyer in that case; with gifts, they don't. Use the normal one. It helps!

#11 saetia

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Posted 27 January 2010 - 01:21 AM

I changed my Lowball rules to reflect this policy.
NieR = my GotY.

#12 formerroadie

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Posted 27 January 2010 - 01:24 AM

I changed my cheese to eat my mold....

#13 Karma Is a Bish

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Posted 27 January 2010 - 01:52 AM

I have a student account so I only have one payment option and I think it's a payment that doesn't have fees but isn't a gift so am I still okay?
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#14 PlayableMoogle

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Posted 27 January 2010 - 02:36 AM

I prefer to pay others with the fees on top of the purchase, honestly, and try to suggest the same (although I have also suggested gifting as an option).

I kind of like this rule. It keeps us honest.

And yeah, I'm a goody two-shoes.

#15 Reikon

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Posted 27 January 2010 - 02:46 AM

This is why I've been trying to promote Amazon Payments for so long, but nobody wants to use it. There are no fees for either side.

#16 mistymayem

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Posted 27 January 2010 - 02:49 AM

Yea, I have a student account too and the only option is to send money which I think is a gift. I don't mind taking the risk of sending it as gift but I don't know what to do if gifting is not allowed anymore :(
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#17 EnronLackey

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Posted 27 January 2010 - 02:58 AM

This is why I've been trying to promote Amazon Payments for so long, but nobody wants to use it. There are no fees for either side.


humm .. news to me .. I will look into this ^_^

#18 Modest Oddity

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Posted 27 January 2010 - 02:58 AM

I think it should be user's choice, both sides, if people want to put their necks out, let them. Long as they know they will get no support from paypal/cag if anything were to happen.
People are going to sneak around this rule regardless. I know it's made to keep less bull shit from coming from this, but if anything, I'd just leave this sticky as a warning rather than a rule.

#19 dodgeme

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Posted 27 January 2010 - 03:14 AM

I personally haven't had in issue with people on here yet so I have payed with gift payments. Saves me money and that is all that matters at this point.
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#20 DigitalNerd

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Posted 27 January 2010 - 03:31 AM

I think it should be user's choice, both sides, if people want to put their necks out, let them. Long as they know they will get no support from paypal/cag if anything were to happen.
People are going to sneak around this rule regardless. I know it's made to keep less bull shit from coming from this, but if anything, I'd just leave this sticky as a warning rather than a rule.


I agree. I'd rather do gifts most of the time if the CAG is trusted.

#21 kube00

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Posted 27 January 2010 - 03:48 AM

Interesting

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#22 Lucavious

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Posted 27 January 2010 - 04:07 AM

Gah, I just sent a payment as a gift before this thread got posted. Will do it normally in the future.

#23 token2k6

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Posted 27 January 2010 - 04:46 AM

I think it should be user's choice, both sides, if people want to put their necks out, let them. Long as they know they will get no support from paypal/cag if anything were to happen.
People are going to sneak around this rule regardless. I know it's made to keep less bull shit from coming from this, but if anything, I'd just leave this sticky as a warning rather than a rule.


this. If you're gonna get burned, you're gonna get burned...I have had maybe 3 trades where fees were covered, yet, 56 positive trades. Only burned by one guy, but that was early on..guy was banned from here, that is good enough for me. I'm all for the rule change, but maybe a price limit would have been nice. What about covering fee's on a $1 DLC code? that's a little crazy..
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#24 Modest Oddity

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Posted 27 January 2010 - 05:15 AM

If someone was going to scam, especially a big amount, couldn't they just close their paypal account after taking the money out from their bank or spending it even if it wasn't gifted?
Like the guy mentioned above - if they're going to do it, they're going to do it. I know you have a slightly better chance with some paypal support, but I have heard nothing but horror stories about that anyways.

Best bet in my opinion anyway, is to do simply what we've all been doing for awhile now, using instincts and the feedback system.
Not 100% fail-safe, but the best tools we can use.

Regardless, this is just 1 CAG's 2 cents. To be fair, I think a poll should be implemented, like we normally do for some decisions.
Or are all the mods and cheapy reinforcing this, so no say in it at all?
Don't want to make it a bigger issue than should be, but it doesn't hurt to see our options.

Edited by Sparta, 27 January 2010 - 05:33 AM.


#25 JP

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Posted 27 January 2010 - 05:31 AM

I'm assuming this would affect the people who do the 4-packs on Steam as well? Those seem to fit under the section personal payments because it is similar to paying someone back for their portion of a lunch bill except this is for a game bill.

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#26 Arakias

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Posted 27 January 2010 - 06:05 AM

I dont see why this should be a concern on CAG. Whether or not people send gift or not is up to the agreement between transactors. Obviously and hopefully the buyer knows the logic of paypal. Mods should have no reason to enforce it.

#27 Vendetta_x360

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Posted 27 January 2010 - 06:27 AM

I dont see why this should be a concern on CAG. Whether or not people send gift or not is up to the agreement between transactors. Obviously and hopefully the buyer knows the logic of paypal. Mods should have no reason to enforce it.


This. :applause:

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#28 GogetaSS4

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Posted 27 January 2010 - 06:41 AM

This is why I've been trying to promote Amazon Payments for so long, but nobody wants to use it. There are no fees for either side.


I have Amazon Payments so I guess I will try and use these for transactions on here if they want to.

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#29 shrike4242

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Posted 27 January 2010 - 06:49 AM

First off, there's been an increase in this in the recent months, and when it's been cropping up, I've commented on it and reminded people about the issue. It's not just one single event that happened today to prompt this, but something that's been a growing trend.

Secondly, it's stated clearly in Paypal's user agreement that Personal payments aren't for the purchase of items, only for the sending of money without any item exchange or purchase attached to it. They have Purchase Payments designed for that.

Third, if there's an issue and it's a Personal payment that's involved with the purchase of an item, Paypal won't do anything to work with the aggrieved party. Their fees are what cover their involvement in issues with scams and other issues.

Fourth, as it's been pointed out previously, there are other methods of payment used besides Paypal, such as Amazon Payments. Other CAGs use Amazon gift cards as payment for item purchases, as well as the other options of physical payments.

If I want to use Paypal for my payment transactions, I have to agree to their UA and not skirt them by sending payments for purchases that aren't supposed to do it by that means. I've done it myself once or twice, and then started reading about issues in Paypal's user forums about this being something that Paypal won't do anything about if there's an issue. They clearly state in their UA that Personal payments aren't for purchases of goods/services/eBay items/etc., and wash their hands of the issue. I looked into the UA and found that they spell it out clearly about Personal Payments not being used for purchases.

I know people have had issues in the past with Paypal in regards to disputes, though again, you don't always have to use them for payments. Also, you can mark that the payment doesn't need shipping, if it's for something that won't be physically shipped.

We're not the small site we were numerous years ago. There's plenty of user base here, and with any increase in userbase, there's an increase in people that try to make a fast buck on a scam. Closing out one possible avenue for issues is something that helps all of us.

#30 Vendetta_x360

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Posted 27 January 2010 - 06:51 AM

Understood shrike.

Guess I will be looking into amazon payments now. Fuck PP and their fees...

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