We last wrote about Paypal’s transaction fees more than four years ago, and although most of Paypal’s seling and sending fees remained the same, a few things have changed since then. (See also: New Paypal fees in the Philippines)
We’ll now explain and show below the latest transaction fees when using Paypal. We focus on transactions for Paypal users in the Philippines, hence the currency shown will be Philippine Peso, although the actual Paypal rates and fees are pretty much the same for other countries as well.
3 Types of Paypal Fees
Paypal generally advertises itself as a free payment service platform, and it’s true in the sense that there are no account opening fees or even periodic maintenance fees.
But there are generally three (3) types of fees charged to users when they use Paypal for their transactions. These 3 Paypal fees are:
- Commercial Payments Fee
- Additional Fees (such as Currency Conversion Processing Fee; Withdrawal Fee; eCheck Fee; Chargeback Fee; Credit Card and Debit Card Confirmation Fee; and Records Request Fee)
- Other Pricing Fees (such as Micropayments Fee; Micropayment for Digital Goods Fee; Mass Payments / Payouts Fee; and Personal Payments Fee)
What are Commercial Payments Fee?
In this article, we’ll discuss the first group of fees: the “Commercial Payments Fee”. Simply speaking, these are the regular “Buying and Selling Fees” that Paypal charges users.
Transactions that fall under the category of “Commercial payments” are:
- Payment for the sale of goods or services;
- Payment received after the Seller has used the ”Request Payment” tab on the PayPal website; or
- Payment that is sent to, or received by, a business or other commercial or non-profit entity.
Transactions not mentioned above may fall under a different category, specifically “Personal Payments” or “Micropayments”, which are discussed in a separate article.
Now, some key take-aways:
- The “commercial payments fee” is charged ONLY to sellers and merchants.
2. Thus, if you are a seller, make sure you incorporate PayPal fees in your pricing so you will receive the actual amount you want to receive.
3. The good news for buyers is that they are NOT charged any fees when using Paypal to buy goods or service.
Paypal Fees in the Philippines : Buying and Selling Transactions
The Commercial Payments (Buying & Selling) fees when using Paypal in the Philippines are as follows.
| Paypal Philippines | Transaction Fees |
|---|---|
| For Domestic Payments (from within Philippines): | |
| Standard Rate | 3.9% + P15.00 |
| eBay Standard Rate | 3.4% + P15.00 |
| Merchant Rate | From 2.9% to 3.9% + P15.00 |
| eBay Merchant Rate | From 2.4% to 3.4% + P15.00 |
| For International Payments (outside Philippines): | |
| Standard Rate | 4.4% + P15.00 |
| eBay Standard Rate | 3.9% + P15.00 |
| Merchant Rate | From 3.2% to 4.4% + P15.00 |
| eBay Merchant Rate | From 2.9% to 3.9% + P15.00 |
Some Notes and Tips
- If you’re a seller selling goods and services both in the Philippines and abroad, you can choose to have two pricing schemes: one for Philippine customers (3.9% + P15.00) and another one for foreign customers (4.4% + P15.00).
2. Alternatively, you can simply have one Paypal fee scheme of 4.4% + P15.00 to absorb the cost of receiving Paypal payments from abroad, but this would mean higher cost for your domestic (Philippine) customers.
3. Paypal charges a lower rate for eBay transactions because Paypal used to be a wholly-owned subsidiary of eBay. In 2015, Paypal was spun-off as a separate, independent company but eBay and Paypal’s partnership remains today which is why eBay users still have preferential rates when using Paypal.
4. You can apply to be a “Merchant” to receive lower and discounted rates. Merchants have to meet qualifying calendar monthly sales volume and the account must be in good standing order.
Discounted Merchant Rates
Here are the monthly sales volume required and the corresponding reduced Paypal transaction fees for eligible Merchants.
| Required Sales Volume per Month | Transaction Fees for Standard (Regular) Payments | Transaction Fees for eBay Payments |
|---|---|---|
| Up to P150,000.00 | 4.4% + P15.00 | 3.9% + P15.00 |
| P150,000.01 – 500,000.00 | 3.9% + P15.00 | 3.4% + P15.00 |
| P500,000.01 – 850,000.00 | 3.7% + P15.00 | 3.2% + P15.00 |
| P850,000.01 – 5,000,000.00 | 3.4% + P15.00 | 3.2% + P15.00 |
| Above P5,000,000 | 3.2% + P15.00 | 2.9% + P15.00 |
Must read these other related, useful articles!
This post can be a great addition to a post on how sending money through PayPal affects the fees/funds of the recipient in the Philippines.
For e-commerce in the Philippines, as an OFW, I hope PayPal should always be an option as payment option and not just local banks which is hard to have if you are already working overseas.