# How to Sell Digital Products on Etsy (Fees, Rules, Setup)

> How to sell digital products on Etsy in 2026: $0.20 listings, 6.5% transaction fee, 5 files of 20MB, AI disclosure rules and a $10 sale fee breakdown.

- Canonical: https://zeroraised.com/blog/how-to-sell-digital-products-on-etsy
- Published: 2026-11-11T15:30:00Z
- Author: ZeroRaised Team (https://zeroraised.com/blog/authors/zeroraised)
- Publisher: ZeroRaised (https://zeroraised.com/)
- Section: Revenue
- Tags: digital-products, etsy, marketplaces, pricing

**Short answer:** To sell digital products on Etsy, open a shop, create a listing marked as a digital item, upload up to five files of up to 20MB each, and price it knowing Etsy keeps about 14% of a $10 US sale before ads. You can only sell files you made or designed yourself, and anything made with AI has to say so in the description.

Every fee, limit and rule below comes from Etsy's own help pages or the vendor's pricing page, checked on 11 Nov 2026. The method and opinions are ours and are marked as such.

## TL;DR

- **Fees:** $0.20 per listing for 4 months, 6.5% of the order total, plus payment processing (US: 3% + $0.25) ([Etsy fee basics](https://help.etsy.com/hc/en-us/articles/360035902374-Etsy-Fee-Basics), [processing fees](https://help.etsy.com/hc/en-us/articles/115015628847-What-are-Payment-Processing-Fees-for-Selling-on-Etsy)).
- **Ads you may not control:** Offsite Ads take 15% of an attributed order, or 12% once you have made $10,000 in a 365-day period, at which point they become mandatory ([Offsite Ads](https://help.etsy.com/hc/en-us/articles/360000338367-How-Etsy-s-Offsite-Ads-Work)).
- **Files:** up to five per listing, 20MB each, instant or made to order ([digital listings](https://help.etsy.com/hc/en-us/articles/115015628347-How-to-Manage-Your-Digital-Listings)).
- **Rules:** made or designed by you, AI use disclosed, no prompt bundles ([What can I sell](https://help.etsy.com/hc/en-us/articles/360024112614-What-Can-I-Sell-on-Etsy)).
- **Tax:** Etsy collects and remits VAT on digital items for buyers in the EU, UK and other listed countries ([VAT on digital items](https://help.etsy.com/hc/en-us/articles/115015587567-How-VAT-Works-on-Digital-Items)).

**Disclosure:** ZeroRaised has no affiliate or commercial relationship with Etsy, eRank, Marmalead, Gumroad, Lemon Squeezy or Payhip. No links in this post earn us money.

## What sells as a digital product on Etsy

Etsy is a good fit for files that buyers can see and use right away: printables and wall art, planners and trackers, spreadsheet and Notion-style templates, Canva templates, Lightroom presets, fonts, SVG cut files, sewing or knitting patterns you wrote yourself, and STL files for 3D printing (`.stl` is on Etsy's supported list).

Etsy groups everything on the marketplace into four creativity categories. Digital products sit under "Designed by a seller", which Etsy describes this way: "As a seller, you can offer your original design as a digital download, or use a third party to produce or print your design onto a physical item. This category also includes seller-prompted AI creations." The rule that matters most is blunt: "Digital items listed in your store must be made and/or designed by you, the seller" ([What can I sell on Etsy](https://help.etsy.com/hc/en-us/articles/360024112614-What-Can-I-Sell-on-Etsy)).

### The AI rule

Etsy allows AI tools "as long as they contribute their own creative input and follow Etsy's policies", and "Sellers must disclose within their listing description if an item is created with the use of AI." It also lists AI content that is not allowed at all: "Bot-generated content", "AI-generated functional instructions, such as craft patterns, recipes, and instructions", and "AI prompt bundles" ([same page](https://help.etsy.com/hc/en-us/articles/360024112614-What-Can-I-Sell-on-Etsy)).

Our read: resold PLR packs and lightly edited AI wall art are what these rules target, and they compete with thousands of near-identical files anyway. Your own design or niche knowledge is safer and sells better.

## Etsy fees for digital products

| Fee | Amount | Notes |
|---|---|---|
| Shop setup | One-time, "Cost varies by location" | Etsy does not publish a single figure ([fees and taxes](https://help.etsy.com/hc/en-us/articles/115014483627-What-are-the-Fees-and-Taxes-for-Selling-on-Etsy)) |
| Listing | $0.20 per listing | Listings expire after 4 months; an auto-renewing listing is charged $0.20 again each time it sells |
| Transaction | 6.5% of the order total | Includes shipping and gift wrap if charged (none on digital) |
| Payment processing (US) | 3% + $0.25 | Taken from the total including sales tax |
| Payment processing (UK) | 4% + £0.20 | Rates differ by country |
| Currency conversion | 2.5% | Only when your listing currency differs from your payment account currency ([conversion fees](https://help.etsy.com/hc/en-us/articles/360000344668-Currency-Conversion-Fees)) |
| Offsite Ads | 15%, or 12% for $10k+ shops | Capped at $100 per order; mandatory once you hit $10,000 in any 365-day period |
| Etsy Ads | Optional, from $1 per day | Etsy says all sellers start with a $25 per-day maximum ([Etsy Ads setup](https://help.etsy.com/hc/en-us/articles/360033701174-How-to-Set-Up-and-Manage-an-Etsy-Ads-Campaign)) |
| Etsy Plus | $10 per month, optional | Includes 15 listing credits and $5 in Etsy Ads credit each month ([Etsy Plus](https://help.etsy.com/hc/en-us/articles/360001589928-What-is-Etsy-Plus)) |

Sources: [Etsy fee basics](https://help.etsy.com/hc/en-us/articles/360035902374-Etsy-Fee-Basics), [listing fees](https://help.etsy.com/hc/en-us/articles/360000344908), [payment processing fees](https://help.etsy.com/hc/en-us/articles/115015628847-What-are-Payment-Processing-Fees-for-Selling-on-Etsy), [Offsite Ads](https://help.etsy.com/hc/en-us/articles/360000338367-How-Etsy-s-Offsite-Ads-Work).

Offsite Ads charge only when a buyer clicks an Etsy ad elsewhere and buys "within 30 days". You can opt out until your shop makes $10,000 in a 365-day period; after that you are "required to participate for the lifetime of your shop", at 12%.

### Worked example: what you keep from a $10 sale

Example arithmetic, ours, for a US shop selling a $10 instant download to a US buyer, with no sales tax on the order and no currency conversion:

| Line | No ads | 15% Offsite Ad order | 12% Offsite Ad order |
|---|---|---|---|
| Sale price | $10.00 | $10.00 | $10.00 |
| Listing fee (auto-renew on sale) | -$0.20 | -$0.20 | -$0.20 |
| Transaction fee 6.5% | -$0.65 | -$0.65 | -$0.65 |
| Processing 3% + $0.25 | -$0.55 | -$0.55 | -$0.55 |
| Offsite Ads fee | $0.00 | -$1.50 | -$1.20 |
| **You keep** | **$8.60** | **$7.10** | **$7.40** |

The fixed costs hurt cheap files most. On a $3 printable the same formula gives $0.20 + $0.195 + $0.34 = about $0.74 in fees, roughly 25% of the price. Our read: if most of your catalogue is under $5, bundle it.

## How to set up an Etsy digital listing, step by step

1. **Open the shop.** Etsy's guide walks you through shop name, payment and billing details, then "a one-time, non-refundable shop set-up fee must be paid" ([how to open a shop](https://help.etsy.com/hc/en-us/articles/115015672808-How-to-Open-an-Etsy-Shop)).
2. **Create a listing and mark it as digital.** For an instant download, "you'll need to upload the files that the buyer is purchasing when you create the listing" ([digital listings](https://help.etsy.com/hc/en-us/articles/115015628347-How-to-Manage-Your-Digital-Listings)).
3. **Upload your files.** "You can upload up to five digital files" and "The maximum size for each file is 20MB." Supported types include PDF, JPG, PNG, GIF, ZIP, MP3, MOV, MPEG, STL, EPUB, DOC, RTF and TXT. Zip multi-file packs into one slot and keep each under 20MB.
4. **Or choose made to order.** For personalised files (a custom planner, a name print), "you don't upload a file when creating a made-to-order digital listing." After the sale you go to Orders, choose Complete order, upload the file, and "The buyer will be notified by email that their order is now available for download."
5. **Add images.** Etsy allows "up to 20 photos and 2 videos that are 5-15 seconds in length". For printables and templates it requires "a preview of the actual content buyers will receive" ([image requirements](https://help.etsy.com/hc/en-us/articles/44297885802647-How-Do-Etsy-s-Listing-Image-Requirements-Apply-to-My-Listings)). Show real pages, not just a styled mockup.
6. **Write the description and licence.** Say clearly that it is a digital file, what is in the ZIP, file sizes and formats, what software opens it, and what the buyer may do with it (personal use only, or a commercial licence). Etsy suggests licensing details can live in your shop FAQs ([shop policies](https://help.etsy.com/hc/en-us/articles/115014372467-How-to-Set-Up-Your-Shop-Policies)). Add the AI disclosure here if it applies.
7. **Set price, tags and attributes**, then publish.

Buyers find the files under Your account, then Purchases, then Download Files. Guest buyers get a link in their receipt email, and Etsy notes "You can't download a digital purchase through the Etsy app at this time" ([downloading a digital item](https://help.etsy.com/hc/en-us/articles/115013328108-How-to-Download-a-Digital-Item)). Put that line in your description; it heads off a lot of "where is my file?" messages.

## Refunds, VAT and Star Seller

**Refunds.** Etsy states that "digital listings are not able to be returned or canceled." But "if there's a problem with your digital order, like it's not as described in the listing or the seller never delivers the file", the buyer "may be covered under Etsy's Purchase Protection" ([same page](https://help.etsy.com/hc/en-us/articles/115013328108-How-to-Download-a-Digital-Item)). Our read: an accurate preview is your best refund policy.

**VAT.** "Etsy collects and remits VAT on digital items purchased by buyers located in certain countries", the list covers the EU, the UK and dozens of other countries, and "Sellers are not responsible for adding VAT to their digital listing prices" ([VAT on digital items](https://help.etsy.com/hc/en-us/articles/115015587567-How-VAT-Works-on-Digital-Items)). For a solo seller this is one of Etsy's quiet advantages over running your own checkout.

**Star Seller.** The badge needs a 95% first-message reply rate within 24 hours, 95% of orders shipped on time with tracking, average reviews of 4.8 or more, and "at least 5 orders and $300 in sales over the past 3 months" ([Star Seller](https://help.etsy.com/hc/en-us/articles/4403058372503-What-is-the-Star-Seller-Badge)).

## Niche and keyword research

Start free: type your idea into Etsy's search bar and note the autocomplete suggestions. They show phrases real buyers type. Then open the first two pages of results and record, for 20 listings, the price, the number of reviews on the shop and what is in the bundle.

If you want volume and competition estimates, two paid tools are built for Etsy:

| Tool | Price (from its pricing page) |
|---|---|
| [eRank](https://erank.com/pricing) | Free plan at $0; Basic $5.99/mo, Pro $9.99/mo, Expert $29.99/mo (cheaper billed annually) |
| [Marmalead](https://marmalead.com/pricing) | $19/mo monthly, $190/year annually, or $300 once for lifetime; no free plan listed |

Our read: eRank's free plan is enough for the first month. Pay for a tool once you have 20 or more listings and need to decide which to rework.

**Pricing method (ours).** Take the median price of the top 20 listings for your exact phrase. Price at or slightly above it if your preview is clearly better, and below it only as a launch tactic on one listing, not the whole shop. Run the result through the fee table above so you know what each sale is worth to you.

## Listing SEO that follows Etsy's limits

- **Title:** "A listing’s title can be up to 140 characters long" ([create a listing](https://help.etsy.com/hc/en-gb/articles/115015628707-How-to-Create-a-Listing)). Lead with the phrase a buyer types ("budget planner printable"), then format and use.
- **Tags:** "You can use up to 13 tags per listing", "Each tag can contain up to 20 characters" and tags can only include "spaces, letters, numbers" ([tags guide](https://help.etsy.com/hc/en-us/articles/360000336307-How-to-Use-Tags-to-Get-Found-in-Search)). Use all 13, as multi-word phrases, and do not just repeat the title word for word.
- **Attributes:** fill them in. They are extra structured data Etsy can match against searches.
- **Images:** the first photo is your thumbnail in search. Show the actual product, readable at small size.

Mockups are easy to make in Canva or with a mockup generator such as Placeit. We could not verify either tool's current price today, so check their pricing pages yourself.

**Protecting your files (ours).** You cannot stop a determined buyer from sharing a PDF. Watermark preview images, not the delivered files. Put a short licence page inside every ZIP, and use Etsy's intellectual property reporting if you find copies listed by others.

## Etsy vs your own store

Etsy's fees buy you search traffic. Your own store keeps more per sale but brings no buyers. Here is how a $10 sale compares, using each vendor's published fees:

| Platform | Published fee | You keep on $10 (our arithmetic) |
|---|---|---|
| Etsy (US, no Offsite Ad) | $0.20 + 6.5% + 3% + $0.25 | $8.60 |
| [Lemon Squeezy](https://www.lemonsqueezy.com/pricing) | 5% + 50¢ per transaction | $9.00 (non-US transactions may add small fees) |
| [Payhip](https://payhip.com/pricing) Free | 5% transaction fee, plus PayPal or Stripe standard rates | $9.50 before processor fees |
| [Gumroad](https://gumroad.com/help/article/66-gumroads-fees) direct | 10% + $0.50 plus 2.9% + $0.30 card processing | $7.91 |
| Gumroad Discover sale | Flat 30%, processing included | $7.00 |

Our read: start on Etsy while you find out which products sell, because a new standalone store gets almost no traffic on its own. Add your own store when you have an email list, a following, or steady traffic from Pinterest. Our guide on [using Pinterest to sell digital products](https://zeroraised.com/blog/how-to-use-pinterest-to-sell-digital-products) covers that channel, and [how to sell digital products online](https://zeroraised.com/blog/how-to-sell-digital-products-online) compares the standalone platforms in depth. If templates are your thing, [how to sell Notion templates](https://zeroraised.com/blog/how-to-sell-notion-templates) shows how sellers build a price ladder from free to premium.

## A 30-day plan

| Days | Do this |
|---|---|
| 1-3 | Pick one niche. Collect 30 search phrases from Etsy autocomplete and eRank's free plan. |
| 4-7 | Record price, bundle contents and preview style for the top 20 listings. Set your price with the fee table. |
| 8-14 | Make 3 to 5 products you designed yourself. Build previews that show real pages. Write one licence file. |
| 15-17 | Open the shop, pay the setup fee, write shop policies and an FAQ covering downloads and licences. |
| 18-21 | Publish 5 to 10 listings with full titles, all 13 tags, attributes and AI disclosure where needed. |
| 22-28 | Pin each listing, share it with any audience you have, and answer every message within 24 hours. |
| 29-30 | Check views, favourites and sales per listing. Rewrite titles and first photos on the weakest, and plan the next five products. |

## Frequently asked questions

### How much does Etsy take from a digital product sale?

Etsy charges a $0.20 listing fee (charged again when an auto-renewing listing sells), a 6.5% transaction fee and a payment processing fee, which is 3% + $0.25 in the US and 4% + £0.20 in the UK. On a $10 US sale that is about $1.40 in total by our arithmetic. Orders attributed to Offsite Ads add 15%, or 12% for shops that have made $10,000 or more in a 365-day period.

### Can I sell AI-generated digital products on Etsy?

Partly. Etsy's What Can I Sell page counts seller-prompted AI creations under Designed by a seller, but says they must disclose the use of AI in the listing description. It bans bot-generated content, AI-generated functional instructions such as craft patterns and recipes, and AI prompt bundles.

### What file types and sizes can I upload for an Etsy digital download?

Up to five files per listing, each up to 20MB. Etsy lists supported types including PDF, JPG, PNG, GIF, ZIP, MP3, MOV, STL, EPUB, DOC, RTF and TXT. Bundling into a ZIP is the usual way to deliver several files in one slot.

### Do I need to give refunds on Etsy digital downloads?

Etsy says digital listings are not able to be returned or cancelled. If a file is not as described or never delivered, the buyer may still be covered by Etsy's Purchase Protection, so clear descriptions and previews matter.

### Should I sell on Etsy or on my own store?

Start on Etsy if you need buyers, because people already search there. Add your own store on Gumroad, Lemon Squeezy or Payhip once you have repeat buyers, an email list or traffic from Pinterest or social. On a $10 sale Lemon Squeezy's 5% + 50 cents leaves $9.00, versus about $8.60 on Etsy, but you bring every buyer yourself.

## Launch your shop beyond Etsy

Once your products are selling, give them a launch outside the marketplace. Work through our [product launch checklist for bootstrapped makers](https://zeroraised.com/blog/product-launch-checklist-for-bootstrapped-makers), then [submit your product to ZeroRaised](https://zeroraised.com/submit) for free. For more guides on earning without investors, [join the ZeroRaised newsletter](https://zeroraised.com/newsletter).

## Sources

- [Etsy Fee Basics](https://help.etsy.com/hc/en-us/articles/360035902374-Etsy-Fee-Basics), last checked 11 Nov 2026
- [Etsy listing fees](https://help.etsy.com/hc/en-us/articles/360000344908), last checked 11 Nov 2026
- [What are the Fees and Taxes for Selling on Etsy?](https://help.etsy.com/hc/en-us/articles/115014483627-What-are-the-Fees-and-Taxes-for-Selling-on-Etsy), last checked 11 Nov 2026
- [Etsy payment processing fees](https://help.etsy.com/hc/en-us/articles/115015628847-What-are-Payment-Processing-Fees-for-Selling-on-Etsy), last checked 11 Nov 2026
- [Etsy currency conversion fees](https://help.etsy.com/hc/en-us/articles/360000344668-Currency-Conversion-Fees), last checked 11 Nov 2026
- [How Etsy's Offsite Ads work](https://help.etsy.com/hc/en-us/articles/360000338367-How-Etsy-s-Offsite-Ads-Work), last checked 11 Nov 2026
- [How to set up and manage an Etsy Ads campaign](https://help.etsy.com/hc/en-us/articles/360033701174-How-to-Set-Up-and-Manage-an-Etsy-Ads-Campaign), last checked 11 Nov 2026
- [What is Etsy Plus?](https://help.etsy.com/hc/en-us/articles/360001589928-What-is-Etsy-Plus), last checked 11 Nov 2026
- [What is the Star Seller badge?](https://help.etsy.com/hc/en-us/articles/4403058372503-What-is-the-Star-Seller-Badge), last checked 11 Nov 2026
- [How to open an Etsy shop](https://help.etsy.com/hc/en-us/articles/115015672808-How-to-Open-an-Etsy-Shop), last checked 11 Nov 2026
- [How to manage your digital listings](https://help.etsy.com/hc/en-us/articles/115015628347-How-to-Manage-Your-Digital-Listings), last checked 11 Nov 2026
- [How to create a listing](https://help.etsy.com/hc/en-gb/articles/115015628707-How-to-Create-a-Listing), last checked 11 Nov 2026
- [How to download a digital item](https://help.etsy.com/hc/en-us/articles/115013328108-How-to-Download-a-Digital-Item), last checked 11 Nov 2026
- [What can I sell on Etsy?](https://help.etsy.com/hc/en-us/articles/360024112614-What-Can-I-Sell-on-Etsy), last checked 11 Nov 2026
- [Etsy listing image requirements](https://help.etsy.com/hc/en-us/articles/44297885802647-How-Do-Etsy-s-Listing-Image-Requirements-Apply-to-My-Listings), last checked 11 Nov 2026
- [How to use tags to get found in search](https://help.etsy.com/hc/en-us/articles/360000336307-How-to-Use-Tags-to-Get-Found-in-Search), last checked 11 Nov 2026
- [How to set up your shop policies](https://help.etsy.com/hc/en-us/articles/115014372467-How-to-Set-Up-Your-Shop-Policies), last checked 11 Nov 2026
- [How VAT works on digital items](https://help.etsy.com/hc/en-us/articles/115015587567-How-VAT-Works-on-Digital-Items), last checked 11 Nov 2026
- [eRank pricing](https://erank.com/pricing), last checked 11 Nov 2026
- [Marmalead pricing](https://marmalead.com/pricing), last checked 11 Nov 2026
- [Gumroad pricing](https://gumroad.com/pricing) and [Gumroad fees help article](https://gumroad.com/help/article/66-gumroads-fees), last checked 11 Nov 2026
- [Lemon Squeezy pricing](https://www.lemonsqueezy.com/pricing), last checked 11 Nov 2026
- [Payhip pricing](https://payhip.com/pricing), last checked 11 Nov 2026

## Frequently asked questions

### How much does Etsy take from a digital product sale?

Etsy charges a $0.20 listing fee (charged again when an auto-renewing listing sells), a 6.5% transaction fee and a payment processing fee, which is 3% + $0.25 in the US and 4% + £0.20 in the UK. On a $10 US sale that is about $1.40 in total by our arithmetic. Orders attributed to Offsite Ads add 15%, or 12% for shops that have made $10,000 or more in a 365-day period.

### Can I sell AI-generated digital products on Etsy?

Partly. Etsy's What Can I Sell page counts seller-prompted AI creations under Designed by a seller, but says they must disclose the use of AI in the listing description. It bans bot-generated content, AI-generated functional instructions such as craft patterns and recipes, and AI prompt bundles.

### What file types and sizes can I upload for an Etsy digital download?

Up to five files per listing, each up to 20MB. Etsy lists supported types including PDF, JPG, PNG, GIF, ZIP, MP3, MOV, STL, EPUB, DOC, RTF and TXT. Bundling into a ZIP is the usual way to deliver several files in one slot.

### Do I need to give refunds on Etsy digital downloads?

Etsy says digital listings are not able to be returned or cancelled. If a file is not as described or never delivered, the buyer may still be covered by Etsy's Purchase Protection, so clear descriptions and previews matter.

### Should I sell on Etsy or on my own store?

Start on Etsy if you need buyers, because people already search there. Add your own store on Gumroad, Lemon Squeezy or Payhip once you have repeat buyers, an email list or traffic from Pinterest or social. On a $10 sale Lemon Squeezy's 5% + 50 cents leaves $9.00, versus about $8.60 on Etsy, but you bring every buyer yourself.