Rails: Using Paypal to faciliate marketplace transactions (parallel or chained?)

Question

I want to build a marketplace site where my application connects a 'buyer' and a 'seller' and takes a commission (%) in the process.

I've checked out Adaptive payments API on Paypal and have seen 'parallel payments' as well as 'chained payments'.

However, what I would like to do is make it seem like the buyer is interacting directly with the seller, with my application taking a commission.

I know with parallel payments (Adaptive Payments API) it's possible for the 'sender' to see the 'primary recipient' which in this case would be the seller. In chained payments the buyer would see my application as the 'middle man' (and as the middle man I could take commission). So what I'm kind of looking for is something of a mix between the two. Any ideas?

My other idea is to use a parallel payment and have my application as the second recipient (taking % commission)?

How do marketplace sites do this? Any rails-specific tips would be much appreciated too - i've seen there is a Paypal Adaptive Gem which I could use?

I'm a rails noob and this is my first project.

Answer 1

Adaptive Payments allows you to separately specify who pays the fees and who the primary receiver is. In a chained payment flow, only the primary receiver is shown to the buyer. In short; yes, Adaptive Payments will perfectly suit your needs.
You can get additional info from PayPal directly by filing a ticket with Developer Technical Services at https://www.paypal.com/dts/

Answer 2

Found this gem which let's you use Paypal's adaptive payments in your Rails application.

To make it seem like the buyer is interacting directly with the seller, I've discovered you need to do a 'chained payment' and specify the seller as the 'primary receiver'.

Your 'business/application' can take it's commission by acting as a secondary receiver. To do so you simply add it as a receiver but set :primary => false. When the buyer tries to make a purchase, it'll show the seller's Paypal email address so it looks like you're buying directly. Take a look at the documentation for the gem and you'll see it's pretty straightforward.

The amount sent by the buyer is split up between the receivers (which you can specify in your code). Hope this helps.