Processing Fees

[u/sfitz0076]

We live in a world that has Venmo, Zelle, PayPal, etc. why are vendors still charging processing fees through their own company portals.

[u/rmric0]

Venmo and Paypal both have transaction fees for business accounts (zelle often doesn't but individual banks can be weird).

[u/davegotfayded]

You’re saying this like those apps don’t all charge fees as well.

[u/dandesim]

1. Venmo, Zelle, and Paypal all charge fees for business transactions, they are free for peer-to-peer transactions.

2. Don't pay vendors as a peer-to-peer transaction, as you have 0 recourse if there is any issue.

[u/peterthedj → u/dandesim]

It's also risky for vendors to encourage customers to pay over venmo or other platforms as a personal transaction to intentionally avoid the processing fees. If they are caught, they can have their accounts shut down for violating the terms of service.

[u/Orangeshowergal]

Because there are fees associated with business transactions

[u/egnards]

If you pay for a vendor through Venmo/Zelle/Paypal without fees you are doing a few things:

• Destroying all protection you have as a consumer
• Giving the business extra hassle in time/effort/energy dealing with tracking those transactions [even with a Zelle account as a business the few customers that pay me via Zelle it requires extra time on my part to deal with it versus other avenues, which translates to money]

Any business that asks you to do this is a huge red flag.

If you want any type of buyer protection as you're paying a business you will incur typical fees related to processing payments.

[u/Coldman5]

Those systems generally still have fees for business transactions.

Payment systems like this, with the addition of Credit Cards, exist due to convenience. The mindset being that the speed at which you can do the transaction allows you to increase volume and thus offsetting those costs. It makes sense for a lot of businesses to use these systems without a fee since there is little involved with a transaction at a 7/11 or department store and the amounts are generally lower.

With industries like weddings, volume & convenience aren’t super helpful since there is often contracting and such involved and the values are much larger, so that extra 3.5% that the payment company gets is a fairly large margin.

That being said, they should offer at least one fee-less way to pay, or else their listed & contracted prices are inaccurate. We allow CC payments for events with a total under $1,500 (like a business lunch), but pass along the 3.5% to the person making the transaction. ACH & check are fee-less.

[u/Jackie_Bronassis]

In the wedding industry, they may be counting on your shame about the Forbidden T Word to make money. They often expect you to be willing to pay a premium to avoid it.

[u/Fearless_Average_651 → u/Jackie_Bronassis]

wedding vendors really out here acting like it's 2003 with these fees

[u/peterthedj → u/Fearless_Average_651]

On the one hand, I agree that vendors should just bake the fees into their prices instead of breaking them out as a separate line item. Listing it out separately is what makes it such a big deal to some people.

On the other hand, if the business is willing to pass along the savings to customers who pay by check or cash instead of a credit card, I can see where they might offer that in case it entices a customer who otherwise wouldn't think that vendor is affordable.