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We are using PayPal to receive micro transactions from our apps. The problem is that on production PayPal is charging a much larger fee than it should (afaik). So I suppose there's something wrong in our configuration. On PayPal's Sandbox the fee is OK.

Both on the Paypal.com and on Sandbox.paypal.com, the account's payment solution is this:

PayPal Digital Goods (Express Checkout)

But the fees are quite different:

Paypal.com:

Total amount: €1.49 EUR Fee amount: -€0.40 EUR Net amount: €1.09 EUR

Sandbox.Paypal.Com:

Total amount: $1.49 USD Fee amount:
-$0.14 USD Net amount: $1.35 USD

Based on Paypal's site, the micropayment fee is 5% + $0,08. And the standard pricing is 3.4% + $0.50. It seems Sandbox site is using the micropayment fee and the production site is using the standard pricing.

In both cases, the code calling PayPal's site is the same. We're using the SOAP interface to do a express checkout and we're also setting item's category to DIGITAL. The item's category should be working correctly because after setting the value, we started receiving error that our account didn't support digital purchases. After using the "Sign up now" button at Paypal's digital goods page, the error went away.

Any ideas?

Update:

We checked the "Transaction fees" page for our account. On production, it reports:

Your account is set to the Standard Rate for receiving payments of 3.4% + €0.35 EUR.

And on Sandbox:

Your account is set to the Standard Rate for receiving payments of 2.9%.

The fee reported on production site seems to match the actual fee. But why? Isn't the Digital Goods service available outside US?

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This is really something you're going to have to ask PayPal about. –  Al E. Sep 4 '13 at 12:31
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1 Answer

up vote 1 down vote accepted

This issue was resolved by contacting PayPal support. It seems that the transactions were done correctly but PayPal had to change some setting to allow the microtransaction fees.

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