p2p payment options?

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??

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/websc...ile-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....

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

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 ....