On Oct 11th; Paypal will begin to pocket all fees related to a refund:
This means that as a seller when I issue a refund; the fees Paypal originally collected will not be refunded to the customer. This means of the domestic USA market; 2.9%+.30 will be effectively stolen from the customer. IE if the customer paid $35 to me... the refund back to the customer will only be 33.98.
Personally; I find the whole thing borderline criminal... but there aren't any other options for a small company like mine.
I imagine Paypal's thinking is that the sellers will eat the 2.9%+.30cents on a relatively small number of transactions; but that isn't the case. At least once or twice a month; I have to refund duplicate orders because of Paypal API errors and people resubmit an order. Now this means that those orders won't get 100% of their money back. I also regularly refund overages due to shipping costs - especially overseas. Now I'll have to think twice; or at least remove the 2.9% fees from the refund. Just silly.