Entrepreneurship & Small Business

Paypal - setting up customers on recurring billing

  • Last Updated:
  • Dec 9th, 2020 5:00 pm
[OP]
Deal Fanatic
Oct 7, 2007
8355 posts
4320 upvotes

Paypal - setting up customers on recurring billing

Does anyone know if PayPal can be set up to charge a company's customers on a recurring (monthly) basis? Ideally, we would like to set up our customers so that they can have their credit card information securely stored on PayPal and then we can automatically charge their credit card an amount that can vary each month. For example $20 this month, $20.50 next month, $20.25 the month after.
4 replies
Member
Feb 18, 2014
263 posts
62 upvotes
Yes you can definitely do it, but you are going to overpay. Recurring Interchange (cost of card) for Visa is 1.25% on a domestic card. Add assessment fees and markup and you’re at about 1.6% plus $0.10. Compare that to PayPal 2.9% + $0.30...that will add up in a hurry.
[OP]
Deal Fanatic
Oct 7, 2007
8355 posts
4320 upvotes
gamechanger wrote: Yes you can definitely do it, but you are going to overpay. Recurring Interchange (cost of card) for Visa is 1.25% on a domestic card. Add assessment fees and markup and you’re at about 1.6% plus $0.10. Compare that to PayPal 2.9% + $0.30...that will add up in a hurry.
Thanks for the information.

Are you saying that there are charges over and above the Paypal fees for using such a service? If this is being set up for less than 10 customers, would it be better to just send out invoices to the customers each month and have them use their credit card each time to pay? I was trying to locate more information using the website @ThiruIO provided (thanks @ThiruIO ) but could not find more detailed information explaining how to set this up and the extra charges associated with using the service.
Member
Feb 18, 2014
263 posts
62 upvotes
choclover wrote: Thanks for the information.

Are you saying that there are charges over and above the Paypal fees for using such a service? If this is being set up for less than 10 customers, would it be better to just send out invoices to the customers each month and have them use their credit card each time to pay? I was trying to locate more information using the website @ThiruIO provided (thanks @ThiruIO ) but could not find more detailed information explaining how to set this up and the extra charges associated with using the service.
Apologies if my message was unclear. The cost for recurring transactions from Visa is lower than a regular transaction. This is not reflected in the fees that PayPal charges. As such, you are paying an even bigger premium by processing with them.

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