PayPal Fee Increase - where's the uproar? ;s

[ScottP]

I'm super puzzled, PayPal announced major fee changes a couple of months ago via email, and I've been monitoring and monitoring and yet apart from one little article on some blog website, there is no comments or uproar about PayPal's upcoming insane fee increase when trading with the US.

** was a link to PayPal Policy Change, but apparently I can't post links ** August 19th, 2019 changes

They are removing the merchant rate fee, meaning that if like me you were on 2.4% rate, you're now going up to 2.9%. Very small businesses who were on 3.4% will now enjoy a 0.5% decrease in fees.

However, the most crippling part is the increase in fee in US transactions, doubled from 1% cross border to 2% cross border. This means that in my case instead of paying 3.4% fee, I'm now having to pay 4.9% on all US transactions.

On top of all that, PayPal refuses to work with the likes of transferwise to allow fee-free US withdrawals, and so charges 2.5% on conversion fees from USD to GBP.

Maybe I'm the exception, but the removal of the merchant fee discounts and predominately working in the US, this is a dreadful situation for us after working with PayPal for almost 10 years and now having to shop elsewhere.

 

[STDFR33]

People push prices to compensate for the increase, and Paypal win again.

 

[TheoNe]

There was a recent rumour that the fee increase might be reversed but I am not sure what truth there was to that. Would you give a Paypal competitor a go?

 

[Paulo1Chop]

Positioning yourself ahead of the supply and demand curve is a pretty sweet place to sit!!

 

[ScottP]

There was a recent rumour that the fee increase might be reversed but I am not sure what truth there was to that. Would you give a Paypal competitor a go?

My fingers are crossed that the rumours become a reality! Right now I'm seriously contemplating Stripe as an alternative, they are far more affordable for international transactions and allows USD bank withdrawals to transferwise.

 

[Mr D]

Factor changes into your pricing or switch to another company.

Do comments or uproar usually change a fee change?

 

[Paulo1Chop]

The members posting the big numbers really do bring a lovely ray of sunshine with all their cheerful and positive comments.....

 

[ScottP]

Factor changes into your pricing or switch to another company.

Do comments or uproar usually change a fee change?

Yes - just lookup PayPal's decision to charge full fees on refunds and later reversing it after the backlash.

 

[Aileen B]

There's had been uproar on eBay forums and Facebook groups I'm a member of where we are chained to PayPal by the platform. Thankfully eBay are transitioning to Adyen soon. I
is probably worth looking for an alternative because I don't see PayPal reversing the changes sadly.

 

[Mr D]

Yes - just lookup PayPal's decision to charge full fees on refunds and later reversing it after the backlash.

So perhaps need to organise an uproar then.

If people don't appear to be against it you may have an uphill job.

 

[Hash and Bash]

Having analysed the currency/value/volume of my PayPal transactions from the past year and calculated the old and new fee structures, the overall difference in my fees will be negligible.

 

[Mr D]

Having analysed the currency/value/volume of my PayPal transactions from the past year and calculated the old and new fee structures, the overall difference in my fees will be negligible.

Back when it was announced I worked out it made just over £30 difference a year.
Like any change its factored into pricing as I go along anyway. To be honest its one of the smallest changes of the year.

 

[Mr D]

The members posting the big numbers really do bring a lovely ray of sunshine with all their cheerful and positive comments.....

So you have a viable solution not already mentioned that the OP can use?

 

[ScottP]

I guess as I wrote in my initial post it must only effect a niche few, for us we're about $3.1k worse off as we do a lot of US business.

 

[fisicx]

I guess as I wrote in my initial post it must only effect a niche few, for us we're about $3.1k worse off as we do a lot of US business.

Same here. But I leave it all in $ and transfer out every 6 months in one lump. The charges are annoying but as I deal with countries all over the world it's far easier to stick with PayPal. Moving to stripe would cause more problems than it's worth.

 

[NickGrogan]

$3.1k worse off as we do a lot of US business

Get a US bank account, move the money from there to Transferwise and into £s

 

[jmann]

There is no need to get a US bank account. If you have Transferwise borderless account with USD then you can withdraw directly from PayPal with zero fee. I have been doing this since last year without any problem. I am withdrawing over $100k every month without any issues.

Do NOT convert the money via PayPal.

 

[Mr D]

There is no need to get a US bank account. If you have Transferwise borderless account with USD then you can withdraw directly from PayPal with zero fee. I have been doing this since last year without any problem. I am withdrawing over $100k every month without any issues.

Do NOT convert the money via PayPal.

Interesting idea. Will keep it in mind for the future.

 

[ScottP]

There is no need to get a US bank account. If you have Transferwise borderless account with USD then you can withdraw directly from PayPal with zero fee. I have been doing this since last year without any problem. I am withdrawing over $100k every month without any issues.

Do NOT convert the money via PayPal.

I've requested this repeatedly, and this is what I am told:

Dear xxx,

Thank you for contacting PayPal Customer Support. My name is ... and I am happy to assist you with adding a US bank account,

As per previous emails PayPal require a copy of the Bank statement directly from the US bank and not a third party like TransferWise.

It is my pleasure to assist you. Thank you for choosing PayPal.

Yours sincerely,
...

 

[jmann]

Don't bother emailing them. You need to phone them to add the USD bank account. Mention the bank as Community Federal Savings Bank which is what Transferwise is using. They will be able to add the bank account for you.

If the agent refuses then hang up and try again. I had to call them a couple of times to get this done.

Make sure NOT to mention Transferwise. If you do, they will refuse to add it.

 

[ScottP]

Don't bother emailing them. You need to phone them to add the USD bank account. Mention the bank as Community Federal Savings Bank which is what Transferwise is using. They will be able to add the bank account for you.

If the agent refuses then hang up and try again. I had to call them a couple of times to get this done.

Make sure NOT to mention Transferwise. If you do, they will refuse to add it.

Ahah! Fantastic, thank you. After the second call they added it successfully. I've done a withdraw in hope it all works fine but looks promising to me. Thanks for your help!

 

[jmann]

I am glad it worked. Initial withdrawal might take 2-3 business days. After that, it will take 1 business day which is pretty good.

 

[arnydnxluk]

There was a recent rumour that the fee increase might be reversed but I am not sure what truth there was to that. Would you give a Paypal competitor a go?

There isn't really a PayPal competitor. The brand is widely recognised and while you can take cards, customers will often request and prefer PayPal. I trialled removing PayPal earlier this year for one of my businesses (only for those who hadn't used PayPal in the past month) and within days had people asking where the PayPal checkout method had gone.

Ahah! Fantastic, thank you. After the second call they added it successfully. I've done a withdraw in hope it all works fine but looks promising to me. Thanks for your help!

My concern with this hack is that PayPal will decide to remove the bank account in future. It's clear they're making a strong effort to prevent people from adding TransferWise accounts and they really don't want these accounts to be added (ridiculous in my opinion considering we pay transaction fees but that's how it is).

Best bet is surely to set up a USD account with the likes of HSBC and add that, although it's not something I've explored yet and no doubt their exchange rates won't beat TransferWise. At least you then know PayPal won't suddenly one day drop your USD account!

 

[jmann]

Best bet is surely to set up a USD account with the likes of HSBC and add that, although it's not something I've explored yet and no doubt their exchange rates won't beat TransferWise. At least you then know PayPal won't suddenly one day drop your USD account!

No, that wouldn't work. PayPal requires USD account to be based in the US. They refused to add our USD account with HSBC.

 

[arnydnxluk]

No, that wouldn't work. PayPal requires USD account to be based in the US. They refused to add our USD account with HSBC.

Ah, didn't realise that. They really are terrible when it comes to FX.

 

[HostOX]

hmm, is this anything to do with the advert I saw of a new company created by PayPal for international money moving?

Push them off PayPal to the new product?

We generally use card payments via stripe so we won't be really hit.

 

[nick34785]

Don't bother emailing them. You need to phone them to add the USD bank account. Mention the bank as Community Federal Savings Bank which is what Transferwise is using. They will be able to add the bank account for you.

If the agent refuses then hang up and try again. I had to call them a couple of times to get this done.

Make sure NOT to mention Transferwise. If you do, they will refuse to add it.

Can a USD account not be added online, you have to call?

Does it work to withdraw to a card with a UK Paypal account? I read that if you call them and ask to change the default currency on the card to EUR (if it's a EUR card) then you can withdraw EUR without currency conversion. Anyone tried that?

 

[fisicx]

I’ve got three currencies on my PayPal account all linked to a UK bank account. I just added the new currency online.

 

[Paul Norman]

I offer both paypal as an option on the e commerce stores I run. Around 75% of transactions are not through paypal - customers choice, and both methods are equally visible.

The increase in fees is never welcome, but the reality is that Paypal is pretty much the only business of its kind, and many buyers like it. I reckon they could get away with charging 5% before there was an outcry.

 

[Jack O]

Everything clear in this thread on USD currency. What about EUROs? Are there PayPal UK account holders able to successfully withdraw EUROs to a Euro bank account?

 

[arnydnxluk]

Everything clear in this thread on USD currency. What about EUROs? Are there PayPal UK account holders able to successfully withdraw EUROs to a Euro bank account?

For some reason PayPal no longer allows you to add bank accounts for foreign currencies online. You may have some luck in calling them and asking them to add the account.