How the result is calculated
PayPal has no monthly charge for a standard business account. It takes its fee when a payment arrives, and the size of that fee depends on three things: which kind of payment it is, where the payer is, and whether the money has to be converted. Each country PayPal serves publishes its own merchant fee page with its own rates, so the same sale costs a British seller less than an American one, and a Dutch seller more than a French one.
The core of the fee is the commercial transaction rate, a percentage of the payment, plus a fixed fee that PayPal sets per currency: 49 cents in the United States, 30p in Britain, 39 cents for PayPal Checkout in Germany. A payment from abroad adds an international surcharge, a percentage that varies by the payer's region; within the European Economic Area, a euro-area seller pays none. When the payment arrives in a currency other than the one you hold, PayPal converts it at its own rate, which carries a spread above the base exchange rate.
Fee(A × r + f) + A × s + A × c
You receiveA − Fee
- A
- the amount the buyer pays
- r
- the commercial transaction rate for the method
- f
- the fixed fee for your currency
- s
- the international surcharge for the payer's region
- c
- the currency conversion spread, when the payment is converted
Worked example
The calculator opens on a $100 sale through PayPal Checkout by an American business to an American buyer.
| Item | Amount | How it is obtained |
|---|---|---|
| Commercial rate | $3.49 | 3.49% × 100 |
| Fixed fee | $0.49 | for US dollars |
| PayPal fee | $3.98 | 3.98% of the sale |
| You receive | $96.02 | 100 − 3.98 |
A British seller making the same sale in pounds to a buyer in Ireland pays a different rate, and a surcharge for the payer's region on top.
| Item | Amount | How it is obtained |
|---|---|---|
| Commercial rate | £2.90 | 2.9% × 100 |
| Fixed fee | £0.30 | for pounds |
| International surcharge | £1.29 | 1.29% × 100 for an EEA payer |
| PayPal fee | £4.49 | against £3.20 for a UK buyer |
Reading the result
The headline is PayPal's whole fee on the payment, with its share of the payment and the amount that lands in your account. The breakdown gives each part its own line and working, so you can match it to the transaction details PayPal shows. Below it, every method on PayPal's page is priced on the same amount for every payer region. In Britain that table shows a card payment from a guest without a PayPal account at 1.2% plus 30p, well under the 2.9% of a payment from a PayPal account.
The monthly figure assumes all your payments are the same size. Because of the fixed fee, small payments cost more in proportion: a $5 sale in the US pays $0.66 in fees, more than 13%.
What changes the result
Where the buyer is
International surcharges are the largest variable most sellers face. An American seller pays 1.50% more on any foreign buyer. A seller in Germany pays nothing extra on a buyer anywhere in the EEA, 1.29% on one in Britain and 1.99% elsewhere, while a British seller pays 1.29% on an EEA buyer. Selling into a region with a lower surcharge can matter more than the headline rate.
The payment method
PayPal Checkout from a PayPal account, card payments processed by PayPal, QR code payments and, in Germany, goods and services payments between accounts each have their own published rate. A seller who takes cards through PayPal's card processing pays the card rate rather than the Checkout rate.
Conversion
The conversion spread is charged on money that has to change currency. Holding a balance in the buyer's currency avoids it until you convert; letting PayPal convert every payment as it arrives costs about 3% in most countries and 4% in Canada.
What is not included
Only the standard rates PayPal publishes on each country's merchant fee page are modelled. Personal payments between friends and family, charity rates, micropayment pricing, Pay Later, alternative payment methods and the optional interchange-plus card pricing are left out. Dispute and chargeback fees are separate charges. The fixed fee used is the one for your own currency; a payment in another currency carries that currency's fixed fee, which the page lists in a table of its own.
India is a special case: PayPal supports only international payments for businesses there, so the calculator shows a single rate for buyers abroad. Sri Lanka has no merchant fee schedule yet, and the calculator says so.
Using the result
Add the fee to each sale's cost when you price. A $40 item with a $12 margin keeps $10.11 after a domestic PayPal Checkout fee, and $9.51 after the surcharge on a foreign buyer, a fifth of the margin gone before postage. The margin calculator and the break-even calculator both take that figure as a cost.
If you want to receive a round amount, use the price-to-charge mode rather than adding the fee on top: PayPal charges its percentage on the whole payment, including the part that was meant to cover the fee. Check where surcharging is allowed before showing a PayPal fee to the buyer. Recheck the rates after PayPal updates its fee page; the date the figures were read is under each fee's working.