Paypal describes payments this way:
You can send money to make a purchase or to make a personal payment to someone.
If you’re making a purchase, there are 3 payment types:
Goods - Select this payment type when you’re paying for something that you didn’t buy on eBay.
Services - Use this payment type when your purchase is not a product but a service (for example, work performed for you by someone else).
eBay Items - Select this payment type to pay for things you buy on eBay.
When you make a purchase, the seller pays a small fee to receive your money.
If you’re sending a personal payment, payment types include:
Gift - Select this payment type when you’re sending money as a gift for a birthday or other special occasion.
Payment Owed - Use this payment type for things like reimbursing a friend for your share of a restaurant check, or repaying money that a family member loaned you.
Cash Advance - Select this payment type when the money you’re sending isn’t for the purchase of goods or services. (Remember that your card issuer may charge a fee for cash advances.)
Living Expense - Use this payment type when you need to pay regular, recurring expenses like rent or utilities.
Other - Select this payment type for anything that’s not covered by another payment type.
You can make a personal payment to anyone in the U.S. for free. Just make sure that you pay for the entire payment using your PayPal balance or bank account. A small fee applies to payments made with a debit or credit card. For more information, click Fees at the bottom of any page.
Using personal payments to get paid for goods is a violation of the Paypal user agreement:
4.1 Receiving Personal Payments. If you are selling goods or services, you may not ask the buyer to send you a Personal Payment for the purchase. If you do so, PayPal may remove your ability to accept Personal Payments.
You also agree to bear the financial risk of any chargebacks. The only exception is if you qualify for seller protection. To do so: "You must ship the item to the shipping address on the Transaction Details Page"; there is no shipping address for a personal payment, so asking the buyer to use gift never qualifies you for seller protection.
IMO, saving 3% on a deal is a silly trade-off for risking a scam. Even if you have no qualms at all about the business ethics of avoiding paying a fee for the service Paypal offers--and I do since I am a service provider and do not appreciate it when people beat me out of my fees--I personally do not want to accept the risk of a charge-back, so I make sure to use the right transaction form for all deals.
|