PayPal Boosts Rates Charged To Merchant Partners


PayPal is increasing the rates it charges businesses on its platform in a move to accentuate its value over its competitors and emphasize the benefits it provides, according to a press release on Friday (June 18).

The global FinTech company pointed out the benefits of using its platform, which includes accelerated launches of new products and capabilities that have made it a complete commerce partner to businesses.

PayPal said it is more than “just a button or payment processor” and has evolved to help businesses drive growth, whether in person or online. The digital platform also pointed out benefits such as a 60 percent conversion rate when people choose PayPal as a payment method and that shoppers are three times more likely to complete a purchase when PayPal is offered.

“Additionally, we are continuing to partner and invest in our platforms to enhance payment experiences, provide greater choice for the way people pay for goods and services, improve protection and security measures to give people peace of mind when transacting digitally, and improve authorization and conversion rates,” the company said in its press release.

PayPal will charge sellers 3.49 percent plus 49 cents to process transactions that take place via its products such as its button on merchants’ websites or through its digital wallet. Sellers will be charged 2.59 percent plus 49 cents for PayPal to process digital payments (without Chargeback Protection) made with cards from Visa and Mastercard issued by other companies.

PayPal previously charged sellers 2.9 percent plus 30 cents to process payments on most online transactions, Reuters reported. Lowering rates for basic transaction processing is a move intended to help PayPal better compete with competitors, including Stripe and, Dan Leberman, PayPal’s senior vice president for small and medium business and partners, told Reuters.

“We are changing prices to help our customers understand even more clearly where we provide value,” Leberman said in a Reuters interview. “We think it’s a bold price to come out with.”

PayPal is dominating digital and physical store shopping by gender and generation in almost all markets. At its height in the spring of 2020, PayPal’s mobile wallet had been powering 28 percent of in-store mobile transactions.