PayPal quietly increases fees

It is interesting how PayPal thought that no one would notice when it quietly raised their fees. The new fees, took place last June were not immediately known until after PayPal started charging for it. However, this article posits that there’s more than just higher fees.


ars technica wrote:

In June, PayPal made a number of changes to its User Agreement and posted an update to the PayPal Blog. At that time, director of product marketing Heinz Waelchli wrote that PayPal had now begun allowing those with business and premium accounts to make personal transfers to friends and family for free. This, in itself, is a welcome update—I use my PayPal account to receive payments for items I sell on Etsy, but now I can send money to my brother from the same account without either of us having to give PayPal a cut.

What PayPal failed to do was inform users of the fact that any transfer having to do with goods or services will be charged the 3¢ + 2.9 percent fee no matter who or where it's coming from. This includes payments sent from personal accounts as well as payments made after someone has sent you a request for payment (even if that request has nothing to do with goods or services).

For example, a personal account sending another personal account money for a one-time payment for, say, mowing your lawn was not previously charged any fees on either side, but is now charged the usual transaction fee (the sender gets to decide who pays). The only way to avoid this is by selecting "gift" when making the transfer—something you can't do if you're following through on a purchase or invoice from someone. And, if you fall into this category (which many people do), it's likely that you had no idea about the changes until just now.

Well, it appears as if the lack of a "huge formal communication" has now begun to anger users, as it comes off as a shady way to hide the addition of fees to mass numbers of transactions. Sure, users would have been irritated either way, but doesn't PayPal know that the way to handle bad PR is to be the first one to control the message? People value openness and transparency—especially when bad news is involved. Now, those controlling the message are other, ticked off users, and that won't be an easy one to clean up after.

Go on avail!!!