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by fastspring
4894 days ago
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Re: tax and data protection rules in Europe, over 1/2 of our clients are located outside the US, the majority of those in the EU, and so we have been handling the key EU issues (VAT, euro payment methods & currencies, EU language support, etc.) for some time now. In terms of cost, there's a major distinction in that FastSpring's pricing of 5.9%+$.95/txn or a flat 8.9% is inclusive of the cost to process credit card and other transaction types globally (typically costs 3-4%+ of every transaction including chargeback fees when you get your own merchant account, assuming getting one is an option for you) because FastSpring is the reseller, the merchant of record. The other reason is the vast functionality FastSpring provides as part of its full-service, all-in-one solution, enabling developers to skip the months or even years of dev work and instead focus on product dev and marketing. You can view the difference here: http://bit.ly/uuklQu |
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As far as VAT goes, at the time you appeared to collect it and then remit it directly to national tax authorities, not to your clients. If that is still the case, could you explain why you are required to collect VAT at all if you're acting as a reseller and based outside the EU? If you're acting as the merchant for tax/legal purposes, how do clients offset VAT they have paid themselves against VAT on the purchase if you handle all of the collection and remittance directly? If you're acting on behalf of the merchant, how do clients integrate with your systems so that any invoices generated on your side meet the requirements for sequential numbering if they also sell via other channels?
In terms of data protection, are you now covered by Safe Harbor or equivalent provisions, so there is no risk of clients running into trouble because you might be considered to be collecting personal data on their behalf and then exporting it outside the EEA?
Regarding the pricing, I'm afraid you just have to eat that one. Obviously you're offering a tailored service in exchange for the higher rates, so it's an apples to oranges comparison, but just about everyone from newcomers like Stripe and GoCardless to old school payment gateways now offers hosted options or transparent integrations that can be set up in hours, not "months or even years of dev work". Meanwhile, none of the options we've been considering recently are anywhere close to the rates you charge even with extreme adverse factors. In more normal cases, you're about 3x as expensive as various card payment services, and GoCardless charge a flat 1% and that's it.