p2p payment options?

[vnode]

I have a site that will be an online market places (like ebay)- ie. the site will have buyers and sellers..I need to the buyer to be able to pay the seller directly..and I will need to charge a commission on this.. How can I process payment for this setup?

I could think of 2 solutions - both of which are incomplete for me:
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1. I could charge the buyer's credit card on my website. And then send the money to the seller. There are 2 disadvantages to this:
------> I will incur 2 transaction charges
------> Since I am making payments to the seller, I will have to report to the IRS when the amount goes over $400.

2. I could see that Paypal is one option for the buyer to send money to seller directly... But, that does not involve the my website at all. And therefore, I will not be able to charge the commission or be notified of the payment.

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There are so many online marketplace sites..and I assume that there must a easier way out!! I might be wrong with a lot of the above information (researched from the internet) .. Any idea anyone??

[InfoSourcing]

Hi,

The PayPal option seems right but needs to be implemented differently, instead of using their regular service you could use their API calls check out this link https://www.paypal.com/cgi-bin/webscr?cmd=_profile-comparison for comparison on solutions.

You could accept all information regarding customer and then charge your customer the full amount and then deduct your commission and then do a PayPal transfer from your account as the second transaction to your other vendor/customer, and you could do all this from your website and the customer need not go to PayPal website :)

I hope this solves easily unless you come across any major hurdle in integration. I suggest Web Payments Pro and Traditional Merchant account + Gateway methods, however the last one is bit costly so not sure what margin you have between two transactions....

[vnode]

Thankyou very much for the reply!!

I did think about this. Here are 2 disadvantages to using this:

1. I would need to pay 2 transaction fees to paypal. (One from the buyer-> website and the other for website->seller)

2. Since I am making a "send money" payment to the seller (I assume thats what you meant when you said I can transfer money to seller), I would still have to report to the IRS if the cumulative income he makes on the site goes over $400.

Correct me if I am wrong... Thanks again for your reply!

Vinod

[InfoSourcing]

Hi,

I'm not sure what margin you are working on but you won't find the feature of Split Payments from PayPal and it doesn't exist, however I would suggest to look into other payment processors/gateways like www.ikobo.com which I believe supports split payment option, from what I read on Paypal forums ...

Unfortunately lots of customers are looking for split payments to reduce transaction charges, but as of now it is a roadblock i guess ....