US PayPal Fee increase coming 2nd August 2021

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There’s a US PayPal Fee increase coming into effect from the 2nd of August 2021. Whilst the increase in the percentage fee is increasing, what will hurt most for sellers who process low ASP transactions is the increase in the fixed fee from $0.30 to $0.49.

NB We have not seen any announcement yet that fees will be changing in the UK or anywhere outside the United States.

PayPal are keen to point out that their fees will still be competitive compared to the competition in the US, using the example of online credit and debit card transactions as the benchmark. If you accept website payments we recommend doing your own comparison for the services that you actually use.

It is unlikely that this will impact anyone selling on eBay as most will have transitioned to eBay payments – eBay themselves are also unlikely to face a fee increase as it’s unthinkable that they won’t already have a custom, non-standard pricing agreement with PayPal. That’s good news as it means eBay won’t have to consider passing any fee increase along to sellers.

However, if you sell on other marketplace or your own website then you may well be impacted, especially where you take direct PayPal payments rather than through an intermediary or the marketplace themselves.

US PayPal Fee increase from 2nd August

  • PayPal Digital Payments
  • For PayPal payment products (such as PayPal Checkout, Pay with Venmo, PayPal Credit, Pay in 4, PayPal Pay with Rewards, Checkout with crypto), which include Seller Protection on eligible transactions, the rate for online transactions will be 3.49% + $0.491 per transaction.

  • In-person Payments
  • For PayPal and Venmo QR code transactions over $10, the rate will be 1.90% + $0.10, and for such transactions $10 and under, the rate will be 2.40% + $0.05. For certain in-person debit and credit transactions the rate will be 2.29% + $0.09.

  • Credit and Debit Card payments
  • Online credit and debit card transactions will be 2.59% + $0.491 per transaction without Chargeback Protection, or 2.99% + $0.49 with Chargeback Protection.

  • Charity Transactions
  • Fees for charity transactions will be 1.99% + $0.49 for confirmed charities (subject to application and pre-approval).

  • Non-standard Pricing
  • For U.S. merchants who have custom, non-standard pricing, rates will remain unchanged for those services as agreed.

Chargeback Protection

Another change that’s been announced in Chargeback Protection . PayPal Chargeback Protection is a fully managed risk solution that helps to reduce loss liability by offloading fraud analysis to PayPal. From the 2nd of August 2021, merchants will be able to enroll from within their account through the Manage Risk tab. After you enroll, if a chargeback occurs, PayPal will refund the disputed amount on eligible transactions.

Chargeback Protection is subject to additional fees which are currently either 0.40% per transaction or 0.60% per transaction.

3 Responses

  1. That’s why we don’t use Paypal. There are much cheaper and better for a seller out there. I think Paypal is the most expensive payment processor going.

  2. Did not think I would have much use for PayPal after eBay bumped them.
    However since Google changed ( the one gimmer of hope this year )it has been busy on the website and despite also having bettwr priced Stripe most still use the more expensive PayPal.
    Margins are constantly squeezed and the supply chain in slowly drying up because of the Brexit mess so hope they don’t rush their next money grab to quick.


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