Stripe takes a 74% Cut of Every 50 cent Sale
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So, just have to say: If I charge 50 cents for access to a short story, when the 30 cents per sale + percentage is figured in, Stripe will take a 76% cut of every sale. If I charge a dollar, then they take a mere 37%. (My income from a $1 sale was 63 cents.)
Don’t know what else to say beyond that. The service really isn’t usable with that kind of a markup. Better to make the minimum something like 5 dollars rather than 50 cents—or maybe WordPress should consider a different service?
I’m going to go back to using Paypal I think.
The blog I need help with is: (visible only to logged in users)
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Hi @upinvermont, sometimes that fee schedule works out better, but not so much with items that are under a dollar. You’ll want to determine what’s best for your case and choose a payment processor accordingly.
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Yes, not so much with items under a dollar, or a dollar, or even under three dollars. Services like Paypal and Patreon offer micro-payment fees—5 cents + % on payments under three dollars for example.
Wordpress should not be offering 50 cent micro-payments if they can’t offer commensurate micro-payment fees. This is in WordPress’s control, not Stripe’s.
Also, WordPress needs to stop misleadingly stating one’s “Total Earnings” on the Earnings page. What I “earn” is Net, after fees. That is my “total earning”. I didn’t make $1.00 in Total Earnings. I made 63 Cents. $1.00 was the Total Paid for the product.
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This is in WordPress’s control, not Stripe’s.
That’s actually not the case – Stripe sets that amount. In USD, that minimum amount is $0.50. Additionally, processing fees are common with any payment processor and those amounts are set by that payment processor, so there’s not much WordPress.com can do to change that.
For Stripe – they collect 2.9% + US$0.30 for each payment made to your Stripe account.
Many small businesses and individuals will add the cost of the payment processing into their product/donation pricing in order to not lose money on smaller transactions.
The fees WordPress.com charges is based on the WordPress.com or Jetpack Plan you have and are calculated as a percentage of your revenue, not a per-transaction fee. You can see the fees for the different plan levels here:
https://wordpress.com/support/wordpress-editor/blocks/donations/#related-fees
“Total earnings” shows all charges collected by Payments buttons on your site, so it’s not reflecting your net earnings.
I hope that clarifies things.
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That’s not at all true. WordPress sets the minimum bloggers can charge for an item on WordPress, not Stripe. It strikes me as absurd that WordPress would set that lower limit at 50 cents knowing that Stripe is going to take a 74% cut. What’s the point? As I pointed out, other services offer smaller fees for micro-purchases, and if they can, with a smaller market cap than WordPress, then WordPress can too.
But, as you write, there are ways around this. I can direct customers to a Paypal storefront. Which I’ll probably do, since they also offer reduced fees for micro-payments.
Lastly, after I take 74% of your next paycheck, I’ll comfort you with the knowledge that I never touched your “Total Earnings”. :)
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But, as you write, there are ways around this. I can direct customers to a Paypal storefront. Which I’ll probably do, since they also offer reduced fees for micro-payments.
Good news then – your Premium plan gives you access to the PayPal Donate or Buy Now buttons so you can have them directly on your site rather than needing people to go to a separate site to donate:
https://wordpress.com/support/paypal/
I hope that helps!
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Bad advice.
One has to set up a micropayments account with Paypal, and WordPress either has not done that on behalf of its bloggers or can’t. I just made a $1 sale using the Paypal Buy Now button and Paypal took a 33% cut.
Paypal, by the way, correctly listed my total earnings as 67 cents.
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Just want to add, by the way, that in general I would not advise bloggers selling goods for $10 (or less) to use WordPress’s tools. Paypal offers Micropayment rates for sellers offering goods for $10 dollars or less; and Patreon also offers much better rates for Micropayments. Using WordPress’s tools means giving away over half or more of ones “Total Earnings”, depending on the size of the payment.
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I’m currently sorting that out. It may be necessary for me to create a new business account for micropayments (payments of $10/$12 or less — I’m getting conflicting information on this). If it’s possible to link directly to such a business account, I’ll update.
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Okay. My mistake this time.
It looks like I need to change my Paypal account to a “Micropayments” account. Apparently the only way to do that is to phone Paypal directly rather than online. I’m currently on hoooooooooooooooold.
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