In Addition To Paypal’s Dystopian Policy Change And Later Preventing Users From Closing Accounts During The Backlash, Paypal Forces You To Pay More Fees By Take Control Of Your Money
3 min read
A while ago on October 8th, Paypal had announced that they would undergoing a policy change that would enable them to be charge users $2500 per issue basically for posting any information or transacting for any product or service they do not like or agree with. The backlash of this was swift and immediate with many users looking to terminate their accounts with Paypal. Financial journalist and Fox Business host Charles Payne attempted to terminate his Paypal account and yet his request was totally ignored and he simply received this email in response.
By following day Paypal went ahead claiming that the proposed policy change was an error and misunderstanding and a mistake as google search for delete Paypal went trending.
However, they then silently re-added the policy changes after the chaos died down.
I came this article that explains it all very well.
If they really about “intolerances” they would just delete your account like JP Morgan had done (regardless of whether you agree with what JP Morgan did it is still way less dystopian) but somehow they managed be be worse than JP Morgan. So Paypal thinks you are “intolerant” but they continue doing business with you as long gas you pay the fine. Do they really care about the morals or the profits, but of course we already knew that.
Apart from all of this I have realised that even before the policy change Paypal had policies that were basically meant to rip off customers.
Basically, every month whatever funds you have in your Paypal account would be automatically withdrawn to a linked US bank account or more likely a card for non-US individiduals. This cannot be turned off. The withdrawal doesn’t cost anything so where is the problem? Well, first of all by the most up-to-date estimates Paypal has a ratio of regular users(buyers) to merchants(sellers) of about 11:1. This means that if Paypal had to choose, it would be way more profitable for them to rip-off the regular users/typical buyers than the merchants. Therefore Paypal forces all funds to be withdrawn out of PayPal every month. This means that every time a buyers wishes to use Paypal to send a payment they would have to re-deposit funds back onto Paypal for a fee. I hope you get the picture. By forcing funds off Paypal they in turn force you to have to pay their fees to draw money from your card(for non-US) to send payments. Further, if you are not in the US they seem to only accept your local currency and force you to pay their exchange rate markup on a USD transaction even if your card should permit USD payments directly. I’m not even sure how they can legally take control of your funds it withdraw it themselves to your account/card.
Now as usual, these policies affect people who are the worst off financially because Paypal’s fee structure is such that
Individuals from the lowest income countries are charged the highest fees to send payments. Individuals from lower income countries have to pay the higher fees for currency conversion and Paypal seems to only accept their local currency and force a currency conversion for more fees. Paypal only accepts linking of US Bank Accounts so foreign individuals may only link their card which from which transfers costs an extra 3.4% + fixed fee.
Paypal fees would thus cost you between 7.4% to 7.9% + some fixed fee if you are in a developing nation to send a payment.
I rarely say this but I really hope Paypal dies.
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