Is Paypal making money?
September 17, 2001 7:13 AM   Subscribe

Is Paypal making money? I read this on thier main Red Cross Page: PayPal will donate 100% of the proceeds to the National Disaster Relief Fund of the American Red Cross.

All donations are tax deductible. Include your address (for a tax receipt) in the "Shipping Address" field when making your donation.

PayPal will realize no profits from money donated to this fund.


Yet, I play Utopia and they have a donation account setup through paypal which states this: All funds raised through this campaign -- minus a commission of $0.30+2.9% which PayPal takes on all payments -- will be forwarded directly to the Red Cross.

So does Paypal give 100% of donations directly donated to its page, and take a commission on accounts set up through secondary pages such as Amazon? If so, with almost $6 Million dollars, that is almost $2 Million dollars!!! (if I did my math right, please correct me if I am wrong.)
posted by da5id (14 comments total)

 
Paypal isn't making any money off the donations that go through their main page. If individuals are taking donations through personal accounts, Paypal will be making money off those donations.

Amazon's donation page has nothing to do with Paypal. That money goes through Amazon's payment system and they aren't making any money off the donations either.
posted by moosedogtoo at 7:21 AM on September 17, 2001


2.9 percent of $6 million is $174,000, not $2 million.
posted by gleuschk at 7:22 AM on September 17, 2001


First, your math is way off. And while people seem to be well-meaning and everything, setting up individual donation accounts sort of defeats the purpose. There is overhead in processing a payment system like this, and all the payment services have standard fees which they charge -- but have waived those charges for donations made to organizations such as the Red Cross during this crisis. If you want to donate money through one of these payment services, use the main links. Otherwise, PayPal and Amazon can't vouch for what's being done with the money -- and you surely can't expect them to waive fees in those instances.
posted by barkingmoose at 7:23 AM on September 17, 2001


Yet, I play Utopia and they have a donation account setup through paypal which states this: All funds raised through this campaign -- minus a commission of $0.30+2.9% which PayPal takes on all payments -- will be forwarded directly to the Red Cross.

I don't know anything about Utopia, but I'm guessing that they're doing this without communicating with PayPal, so they are going to get charged the standard commission. If that's what they're doing, I would suggest that the Utopia people just point people to the Paypal donation page.

So does Paypal give 100% of donations directly donated to its page, and take a commission on accounts set up through secondary pages such as Amazon?

Amazon doesn't use paypal; they have their own competing system.
posted by boaz at 7:23 AM on September 17, 2001


Great, 3 separate people beat me to it. I guess all that's left is to see if anyone else shows up after me.
posted by boaz at 7:27 AM on September 17, 2001


Amazon have their own system, they don't use... oh, nevermind.
posted by gi_wrighty at 7:32 AM on September 17, 2001


Does anyone know why was Amazon's collection page offline for a solid day?
posted by NortonDC at 7:48 AM on September 17, 2001


What about the credit card companies? Don't they take a percentage of any credit card payment?
posted by dmo at 7:57 AM on September 17, 2001


From News.com: Amazon.com suffered a "hardware failure" that crashed several of its departments for more than 12 hours, including the area where Amazon was accepting donations to help victims of Tuesday's terrorist attacks, the e-tailer said Sunday.
posted by barkingmoose at 8:03 AM on September 17, 2001


2.9 percent of $6 million is $174,000, not $2 million

You missed the $0.30 PLUS 2.9%

That is 30 cents of every dollar plus 2.9%.

So, 30% of 6 million is 1.8 million plus however much the 2.9% adds to that, so my math wasn't that far off...

doesn't matter I guess... since Amazon uses a different system... though I could have sworn paypal was being used... oh well.
posted by da5id at 8:21 AM on September 17, 2001


Not that this is in any way relevant or important, but Da5id, it's 30 cents per DONATION, not 30 cents per DOLLAR.
posted by bcwinters at 8:26 AM on September 17, 2001


2.9 percent of $6 million is $174,000, not $2 million

You missed the $0.30 PLUS 2.9%


That's 30 cents of every transaction, not every dollar. Assuming an average donation was ~$30, that's an additional 1%, not 30%.
posted by boaz at 8:27 AM on September 17, 2001


Argh... Scooped twice in one thread. Must be time to quit.
posted by boaz at 8:30 AM on September 17, 2001


bah... I am going back to bed... :-(

dumb dumb dumb....
posted by da5id at 11:49 AM on September 17, 2001


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