PayPal Fee Calculator

Fees are percentage plus fixed, which punishes small payments

The structure is a percentage of the transaction plus a fixed amount per payment. On a 100 payment the fixed component is trivial; on a 5 payment it can approach 10 percent of the total. Micropayment pricing exists for this reason in some markets — a higher percentage with a much smaller fixed fee — and it is worth enabling if typical transactions are small.

Grossing up is not adding the fee percentage

To receive exactly 100 you cannot add 3.49 percent, because the fee is charged on the larger amount you now request. The correct calculation is (target plus fixed fee) divided by (1 minus the percentage). Adding the percentage leaves you consistently short, and the shortfall grows with the amount.

Cross-border and currency conversion stack

International payments carry a higher percentage than domestic, and currency conversion adds a spread above the market rate that is charged separately. A payment that crosses a border and a currency can lose noticeably more than the headline rate suggests, with the conversion spread often exceeding the transaction fee itself.

Refunds do not return the fee

Policy has changed over time and by market, but the fixed portion is commonly retained on a refund and in some cases the whole fee is. Refunding a payment can therefore cost more than never receiving it. Chargebacks are worse, adding a dispute fee on top of the reversed amount.

Friends and family is not a commercial workaround

Personal transfers avoid the seller fee and also remove buyer and seller protection entirely. Using it for a commercial sale breaches the terms, leaves the buyer with no recourse, and risks the account. The saved fee is small against a frozen balance.

Fees are a cost of sale, not an overhead

At 3 percent, fees consume 3 percent of revenue but a much larger share of profit — on a 10 percent net margin that is nearly a third of it. Pricing that ignores payment processing quietly erodes margin on every transaction, which is why the fee belongs in the unit cost rather than in general expenses.

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