Now and Then Premium Subscribers ask which I prefer, credit cards or Paypal, with the intention of using whatever costs me less. I’ve always appreciated the thought, and always said to use whichever works best for you, since by some weird coincidence, Paypal charged the same fees that card processors do — 2.9 percent of the total charged plus a 30-cent processing fee.
Thus, for a $10 payment they skim 59 cents off the top and deposit (after a short waiting period) $9.41 into my bank account.
Until now. Paypal waited until struggling businesses were just starting to come out of Covid slowdowns to raise their fees, to 3.49 percent plus a 49-cent processing fee, so now they’ll deposit $9.15 after skimming 85 cents, or a 44 percent increase in fees on that same $10 charge. I do get a lot of $10 payments.
But doesn’t Paypal also deserve an increase due to the same inflation that’s hitting us all? Well, as businesses are forced to raise their prices Paypal is already getting more fees; this is on top of that. They already had an essentially inflation-proof business model.
So My New Answer to your kind question is whatever works for you …but I do now prefer plastic (credit or debit cards), not Paypal, which is putting the wrong kind of pressure on inflation.
So, what to DO? Nothing, really, unless you’re really mad at this, and then vote with your dollars. You’ll be doing online businesses, or, really, any business, a favor when you make Paypal your last choice for payments.
Meanwhile, despite my having a “rep” at Paypal, he’s completely unresponsive, which is why I’m still having trouble getting my account upgraded to properly report the amounts of payments on “Legacy” auto-renewing subscriptions. (Paypal will collect $10 and report that correctly, but it’s not coded correctly and my shopping cart will send a receipt for $9.) There is a fix, but it’s on their end.
Yet that “rep” contacts me constantly to “set up a call” so he can do what he’s really there to do: convince me to take out a loan from them at very high interest rates, since they know they can just skim my account to make the payments. Not interested, and never have been. (And that’s on top of the interstitial full-screen ad for such loans every time I log in there!) Yep: Paypal is interested in money, not service. To hell with ’em without a GOOHF card!
November 2022 Update
Since posting this, Paypal has lost a lot of money on my fees.
- This April through October, payments were 42.7% Paypal, 50.8% plastic, and 6.5% other.
- The same date range from last year? 50.8% Paypal, 38% plastic, and 11.2% other. Paypal has lost more money from readers switching to plastic than they have gained by raising the price. May it be similar at other sites: I definitely continue to encourage you to help small businesses by paying with plastic instead of Paypal.
- And in all this time they still haven’t fixed things on their end to report to my shopping cart the actual dollar amount charged. Slap … their … forehead!
(Other includes not just checks, but also Patreon, which has also seen a lot of readers switch out to other methods. Patreon only accepts plastic.)
If You Want to Switch from an auto-renewing subscription you set up on Paypal, simply go into Paypal and cancel, which switches you to a regular (vs autorenew) subscription, and then I’ll send a renewal notice in plenty of time to set up a new subscription using a card. Thanks!
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