PayPal Pitfalls

Organizing HomeIntroductionCollecting Payments |

Many participants appreciate the convenience of being allowed to send their payments via PayPal, and you may choose to agree to allow them do this. However, you should not feel obliged to do so given the potential financial pitfalls, detailed below.

Before agreeing to accept payments via PayPal, you should be aware that if PayPal transfers are done incorrectly, you will end up short money in the end ... and those PayPal fees can add up to quite a bit of money.

Please be aware that email notifications from PayPal do not disclose the deduction of fees - you will need to login into your PayPal account online and view the transactions there to confirm that you received the full amount.


PayPal fees

PayPal's fee structure is subject to change, but at the time of this writing it is PayPal's policy that sending money to friends and family is free when the money comes from a PayPal balance or a bank account.

However, PayPal charges a fee 2.9% of the total due plus a 30¢ fixed fee when the money comes from a debit or credit card or PayPal Credit, and the sender chooses who pays that fee ... so your participants need to know that participants must be the ones to pay any fees! You are doing all of the work of organizing for free, you should not also be paying out of your own family's finances to cover any portion of any participant's fees as well.

An additional complication is that participants may also be charged a fee by PayPal and erroneously believe that they have thus paid the fee charged to you. (You will have no way to see any fees paid by the participant and the participant will have no way to see any fees charged to you.)

This issue rarely comes up but should it be raised, Homeschool Adventures reimbursements qualify as personal transfers under PayPal's Terms of Service. Volunteer organizers are not selling a good or service (or receiving any other form of compensation for their efforts). If the issue is raised, politely remind participants that they can always send a check if they prefer. The PayPal option is for their convenience, not yours. You may also direct them to this page for more information.


Getting fully reimbursed

To ensure that you are fully reimbursed for each family's cost of participation, if you decide to allow participants to reimburse you via PayPal, you should be careful to specify that they must select the "I'm sending money to family or friends" option if you are to be fully reimbursed. See our suggested payment instructions for an example on how to do this.

Participants who have not linked their PayPal account to a bank account won't have the option of making a personal transfer. In that case, you should direct them to mail a check or to reimburse you for the fees as well as the total due. There are a number of different PayPal fee calculators available that make calculating those fees quick and easy. One that is easily available on the web is The Fee Calculator.


When it goes wrong

No matter how carefully you word your PayPal instructions, there will be people who fail to follow them, meaning you will come up short. When that happens, you can have three options:

  1. Ask them to mail you a check for the missing amount.
  2. Ask them to send your the missing amount PLUS the additional fee that will be deducted via PayPal again (you can use The Fee Calculator to calculate how much they need to send you).
  3. Issue a refund via PayPal, which will result in your being charged by PayPal, and asking them to mail you a check for the full amount PLUS the PayPal refund fee (currently 40¢).

Handling complaints

If you choose not to accept PayPal, you may receive occasional complaints from participants who feel that your choice is an inconvenience or annoyance to them. Usually they simply don't understand that that accepting PayPal can have financial consequences for the organizer, as well as be the cause of time consuming problems. You may direct them to this page for more information.