PayPal annouces micropayments

for digital music authors and providers

[amznVibe]

An extension of PayPal's existing payment service for online merchants, PayPal's new micro-payment fees are designed to give the digital music industry a more cost-effective payment solution for downloadable music.

The new fees will allow these merchants to process payments at a rate of 2.5% plus $0.09 for each transaction.

press release [home.businesswire.com]

[MarshallClark]

That works out to about $.11 for a $.79 song download - a 13.8% processing fee. That still sounds a bit steep to me.

[amznVibe]

It's better than Apple's published costs for iTunes I believe (13 cents per dollar)?

[Lovejoy]

Where was this announced? I don't see it on my PayPal page.

[amznVibe]

You won't find it announced to the consumer end of PayPal.

There's a little more information here [internetnews.com].

Apparently right now it's only for sites with 3000 or more transactions per month under $5 each.

What I really like is that they are going to make PayPal signups really easy and available on the merchant end, which means more instant checkout qualified customers for smaller sites.

[sun818]

If Paypal held on to merchant's money for two weeks then charge a fee based on the total for that period, the rate would be better for merchants. Meanwhile, Paypal could make money off the float. ;)

[Lovejoy]

Thanks amznVibe,

It would work out great for me as I have several information
products in the $1.39- $3.95 range. Making the sign up
easier will certainly boost sales from the impulse buyer.

[jacker]

Does anyone know if PayPal will offer the same fraud screening for micropayments as they do for current transactions?

Cheers
James

[pbreit]

The fraud screening will remain the same. The only current modification is to the fee schedule.

[jatar_k]

It seems with the 3000/mth they are only targetting medium to large merchants. The small ones still pay the higher fees I assume. Hard to say how to classify the sizes though.