Changing rates is how many businesses stay afloat. Thanks to the increases to cost of living, inflation, and a slew of other elements, every business needs to adapt or sink. But, is PayPal earnest about focusing on helping your business by adjusting rates?

It really depends on how much you’re collecting from customers.

PayPal Rates Per Transaction Changed

Before, PayPal basically charged 2.9% + $0.30 per transaction. Of course, there are also variable rates depending on the system. But, we’ll just stick with the basic plan for now.

PayPal now charges 2.59% + $0.49 per transaction. A little lower on the percentage, but $0.19 higher for the transaction itself.

So, what does that mean?

Donation Users Lose Money

If you’re a creator who uses something like Buy Me a Coffee or Ko-Fi, you’ll see less when someone supports your work. And in the grand scheme of things, this is going to make PayPal a lot more money.

Why is that? Because of how prevalent these donation systems have become online. Microtransactions such as these are most likely among the most processed by PayPal at the moment.

Before, if someone “bought” you a $3 coffee, PayPal would take $0.39 right off the top. And this is before platform fees, such as Buy Me a Coffee’s 5% membership.

So, you’d net about $2.46 any time someone gave you $3 for that coffee.

After changing the rates, PayPal now takes up $0.56. And after paying the BMC fees, you now net $2.28! The $0.18 difference may not sound like a lot. But, what if you have about 500 people buying you a coffee each year?

You’re now losing out on $90 for those 500 people.

Microtransaction Tax

As a whole, you’ll need a minimum payment of $60 to break even on the fees. Anything less than that, and you’ll get less per transaction. This means you’ll receive less money after all of the fees are taken out.

Anything after $60, and it’s a benefit to you.

And there’s the rub. Microtransactions are a way of life for many people. Especially those of us who are starting to rely on one-time donations from supporters.

So, although PayPal’s guise of changing the rates makes it sound good for larger businesses, everyone else is getting bent over a table.

The best way to describe the changes is to call them what they are…microtransaction taxes.

For example, I’ve made about $300 from Buy Me a Coffee supporters. And not a single one of those were donations over $60.

I suppose it’s good for those who have an OnlyFans account and can charge an arm and a leg for nude photos. Horny guys will pay it, and often do.

Although it’s true that I am a very small creator, it makes me wonder about how much money some of the bigger creators are going to pull in.

Given the popularity of platforms like Buy Me a Coffee, Ko-fi, and Patreon, I bet PayPal is raking in the dough, now.

That’s the Cost of Doing Business, I Suppose

Personally, I don’t really mind the price hike of the PayPal rates. That’s part of setting up a business, whether you have a corporation or are a sole proprietor.

What I don’t like is how they try to blow rainbows up your butt by making it sound like it’s a great benefit for businesses.

Sure, businesses that generate more than $60 per transaction. But what about the smaller creators?