Marketplace
Hi, the Australian Government has been cracking down on Credit Card Payment fees. However somehow PayPal is doing a lot of business in Australia yet their small transaction fees seem pretty high?
My wife recently sold an auction item and its a very small item but it ends up with the following:
Total $2.49
Fee $0.36
Total $2.13
So the fees are 0.36 on an item of 2.49, which means the fees are around 14.5% of the total transaction.
Cant the Government do something about this? Paypal also now don't refund transaction fees if an item has been returned.
This is a fixed cost vs marginal cost problem. The effort and work to transmit a small amount is probably very similar to what it takes to transmit a large amount, until you hit anti money laundering figures.
The fixed cost stays the same, so you can't scale the fees down indefinitely.