Sellers in a hurry to access money stored in their PayPal accounts will pay higher fees to use its Instant Transfer service beginning next month. However, sellers who can wait 1-3 business days to transfer funds to their bank account or debit card will continue to pay no fees for Standard Bank Transfers.
When PayPal introduced Instant Transfer to debit cards in 2017, there was a “nominal fee of $0.25 per transfer.” And when it introduced Instant Transfer to bank accounts in 2019, there was a 1% per transaction fee capped at $10. Current fees are described on this page of the PayPal website.
Two significant Instant Transfer fee changes that will roll out on June 17, 2022 include the following:
- Instant Transfer fees for PayPal Consumer Accounts will go from 1.5% plus a $0.25 minimum/$15 max to 1.75% plus a $0.25 minimum and a $25 maximum.
- Instant Transfer fees for PayPal Business accounts will remain at 1.5% of the transfer amount, but the $0.25 minimum fee will go to $0.50, and PayPal will remove the existing $15 maximum cap on fees.
PayPal is not alone in raising rates. In March, we cataloged some of the fee hikes going into effect including online marketplace fees and shipping costs.
Sellers should take note that PayPal is also updating its User Agreement and PayPal Balance Terms and Conditions effective June 17, 2022 as follows:
- Removing provisions relating to the Risk Controls and Fraud Management Filters services as those services will no longer be available.
- Removing references to business fundraisers in the Generosity Network terms to reflect that only users with personal accounts may create fundraisers on Generosity Network.
- Removing any PayPal Key references that are no longer applicable, including retiring the agreement, because we have discontinued the PayPal Key feature.
PayPal is also amending the PayPal Cash Mastercard Cardholder Agreement as of May 17, 2022.
Be sure to read the full announcement on the PayPal website for details on the upcoming changes to fees and terms-of-use.