Still though, that's a huge loss for an extended period of time. I definitely don't like what PayPal is doing but Stripe is also pretty evil in a similar fashion. If someone disputes a charge (due to fraud that Stripe is supposed to prevent but doesn't) then you lose the processing fee and you (the business owner) also get billed a static $15 fee on top of that.
To put some sense of magnitude on it, according to https://appriss.com/retail/wp-content/uploads/sites/4/2017/1... the median percentage of retail sales refunded across all retail categories is 10%, so this translates to about a 0.3% increase in prices. Would you tolerate a 0.3% decrease in return on your investments in exchange for no additional benefit?
Also there are big players in the market that don't support PayPal at all, e.g. Amazon.
I understand that losing that amount of business is painful, but on the other hand, in the long run it pays to have principles.
I guess some businesses will try and put the fee on the customer.
Fortunately this goes both ways:
On one hand, other payment processors will be able to squeeze even more revenue out of the sellers (or buyers).
On the other hand, any competing payment processor will be able to collect more revenue to finance its growth, thus helping them to grow and out-compete PayPal.
Contrast that with Amazon, which is ran very close to zero margins, thus making it harder for any competitors to generate growth-inducing revenue and at the same time offer competitive prices.
I agree that you are likely going to lose some business in the short run, but is that business worth swallowing the refund fees with your own money?
Also times have changed a bit. It's not like eBay is still the biggest market on the web and auto filling forms with your credit card information has gotten a lot easier thanks to modern browsers.