User Agreement - PayPal Payment Agreement for Pre-approved Payments
PayPal Recurring Payments and Billing Agreement
Last Update: Apr 23, 2012
- Recurring Payments
A Recurring Payment is a payment in which you (as a buyer or a sender of funds) provide an advance authorisation to a third party (such as a merchant or eBay) for a third party initiated payment, that is a charge to your PayPal account directly on a one-time, regular, or sporadic basis. Recurring Payments are sometimes called “Subscriptions”, “Automatic Payments” or “Preapproved Payments”. Recurring Payments can be managed from your PayPal Account. By providing an advanced authorisation for a third party initiated payment, you are giving the third party the ability to collect or reverse variable payment amounts from your PayPal account until such time as this arrangement is cancelled.
- You hereby authorise and instruct PayPal to pay the third party (or another person they direct) amounts from your PayPal account for the amounts you agreed to owe and as presented to PayPal by that third party. You agree that PayPal is not obligated to verify or confirm the amount the third party presents to PayPal for the purpose of processing these types of payments. You acknowledge and agree that use of Recurring Payments in any form means that these payments may be variable and scheduled to occur at certain times (in the manner agreed between you and the third party). You should make sure that you fully understand your payment obligations with the third party and ensure you always have sufficient funds to meet your ongoing commitment to the third party.
- If your third party initiated payment requires a currency conversion by us, the amount of the currency conversion fee will be determined at the time the applicable third party processes your payment and completes the transaction. You acknowledge that the exchange rate determined at the time of each payment transaction will differ and you agree to the future execution of third party initiated payments being based on fluctuating exchange rates.
- Third party merchants who present PayPal with a payment request under this Recurring Payments provision, warrant to PayPal that the amounts they present have been properly agreed and consented to by the customer whose PayPal account will be debited (including any applicable changes to those agreed amounts). Third party merchants who present PayPal with a payment request under this provision also agree that they will notify their customers in advance of the amount they will collect (such advance notice must be reasonable for the customer, taking account of all the circumstances) if that amount has increased in such a manner that the customer could not have reasonably expected to pay such an amount, taking into account that customer’s previous spending patterns and the circumstances of the payment.
- Billing Agreement
When you establish a Recurring Payment with a third party merchant, you are also entering into a Billing Agreement with PayPal. By entering into a Billing Agreement you are authorising PayPal to allow the third party merchant to charge your PayPal account directly. PayPal facilitates the transaction between you and the third party merchant, but does not enforce contractual obligations for payment by you or for delivery of goods or services by the third party merchant.
- Payment Method Selection
When the third party merchant requests a payment from your PayPal account, PayPal will always attempt to withdraw funds from your PayPal balance first. If funds in your balance are insufficient, PayPal will look for and attempt to charge a preferred Payment Method that you have set up for the Recurring Payment. You will have the option to select a preferred Payment Method during enrolment, and you can update or change your preferred funding source at any time via the “Account Profile” section on the PayPal website.
If the preferred funding source fails (for example, a credit or debit card expires) and your PayPal account cannot complete a transaction in the first instance, it may be used again to try to complete the transaction. If the preferred funding source in your PayPal account cannot complete a transaction after repeated attempts, each of the other payment methods available in your PayPal account may be used to try to complete the transaction. You will have the ability to disable funding sources for your Recurring Payment, with the exception that if you have one or more credit or debit cards linked to your PayPal account, then at least one of those cards must be enabled for billing.
- Cancelling Recurring Payments
Buyers or senders of funds may cancel a Recurring Payment at any time up to 3 working days prior to the date the payment is scheduled to take place. Merchants must provide buyers with the ability to cancel a Recurring Payment within 3 Business Days of the scheduled date of the Recurring Payment. If your payment is funded by your bank account, then you may cancel this payment following notice of the payment to be made by contacting PayPal customer support via email or telephone.
To cancel a Recurring Payment generally, log into your account, access the "Profile" tab, beneath the "Financial Information" column, click the "My Pre-Approved Payments" link, select and click the relevant merchant and follow the instructions to cancel the payment. If your Recurring Payment is not in this column, then access the "History" tab instead of the "Profile" tab and access "Subscriptions" and follow the directions to cancel the payment. Recurring Payments may also be referred to as "subscriptions" or "preapproved payments". If you cancel a Recurring Payment you may still be liable to the merchant for the payment and be required to pay the merchant through alternative means.
- Enhanced Recurring Payments Policy for PayPal’s Website Payments Standard Customers
This “Enhanced Recurring Payments” Policy applies for Website Standard Payments merchants who have enabled the “Enhanced Recurring Payments” feature and applies to your use of the Enhanced Recurring Payments feature offered with PayPal Website Payments Standard.
The Enhanced Recurring Payments feature enables you to provide your customers with the ability to sign up for “Instalment Plans” and “Automatic Billing arrangements”.
- Instalment Plans.
Instalment Plans allow you to offer your customer the ability to make a purchase from you and pay you in 4 or less instalments. If you use Instalment Plans, the following restrictions apply:
- You may not charge for the first payment of the instalment until you have shipped the goods purchased by your customer.
- You may not charge in more than four instalments for a purchase.
- You may not add finance charges to the payment amount.
- The sum of the instalment billing must not exceed the total purchase price of the goods, including applicable taxes and shipping costs, as applicable.
- You must have and retain your customer’s express consent to charge in instalments.
- Automatic Billing.
The Automatic Billing functionality allows you, the merchant, to automatically charge your customers’ payment source on a regular basis in an amount which you and your customer have previously agreed. The payment you receive is called an “Automatic Payment”. If you use Automatic Billing or Recurring Payments, you must follow these requirements:
- Express Consent. You must receive your customer’s express consent for the amount, frequency, and duration of the Automatic Payment.
- Required Cancellation Procedures for Automatic Payments. You must provide the customer with the ability to cancel an Automatic Payment within 3 working days of the scheduled date of the Automatic Payment. In addition, if the customer signed up for the Automatic Payment through an online method, you must provide a simple and easily accessible online cancellation procedure. If your customer cancels the Automatic Payment, you may not charge for the Automatic Payment.
- Guest Checkout Availability for Instalment Plans, Automatic Billing, and Recurring Payments.
With this functionality, you will be able to offer Instalment Plans, Automatic Billing, and Recurring Payments to all of your customers, instead of only those customers paying you through their PayPal Account. Please note however that this functionality cannot be turned off.
You may terminate your use of Website Payments Standard: Enhanced Recurring Payments at any time. Upon termination, your use of Website Payments Standard: Enhanced Recurring Payments will immediately end. PayPal reserves the right to terminate your usage of Website Payments Standard: Enhanced Recurring Payments if you breach the terms of this Policy or any other User Agreement and incorporated policies which you have accepted from PayPal.
- Instalment Plans.