Have you been affected by Paypal's recent fee hikes?
Australian businesses and sole traders are suddenly being stung by a new 3% PayPal fee charged on any US transfers, including use of a PayPal competitor to convert currency (https://www.businessinsider.com.au/paypal-fee-transferwise-alternative-fx-australia-2020-11).
The extra charge leaves many online businesses, which frequently trade in US dollars, either paying PayPal’s “horrible” FX rates or shelling out thousands of dollars a year in extra fees to use a competitor.
Has your business been affected? What are your preferred alternatives?
I hadn't noticed it particularly. I have a Bankwest Mastercard that has fee-free international transfers which I use for my international purchases. I've not compared rates between PayPal and BankWest.
CommBank isn't too bad with a flat $6 fee.
I’ve been affected by the fee hike you mention. I am co-founder of a website, but my partner is based in the U.S.A.
For the past 3 years, all advertisement revenue and affiliate revenue has been going into my paypal business account. Every month I send a percentage of our revenue to Chris (my partner) and up until the sudden fee increases, we have been doing just fine. Now, the fees have crossed the threshold of nearly 100 AUD every month just to send the money over. We are considering going back to traditional bank transfers now, or even a better priced fee application such as TransferWise. This is a huge bite on our profit and is not something we feel comfortable maintaining for the foreseeable future. We pay taxes already, and don’t feel like adding another tax bill just because of the website we use. Thanks for the question, I hope paypal realizes that fee hikes are not the answer to maintaining their leadership in the market.
Co-Founder of ModestFish
PayPal is undoubtedly a convenient service. However, the recent fee hikes have forced us to begin looking elsewhere. We happened upon another competitor called Wise, which prides itself on very minimal transaction fees and incredibly competitive fee conversion rates. Not only is the user interface much cleaner, but the experience from signing up to using the platform is intuitive and hassle-free. Where PayPal would hit us with unexpected fees that cut into our bottom line, we're always left feeling pleasantly surprised by how fair we're treated using Wise.
Chief Technology Officer @ ConvertBinary
A recent price hike has made on any US transfer has made doing our business tuff. It made our transaction fees almost double. Previously we used square for business transactions but now PayPal and square has almost the same charge for inter-border transactions but for international transfers, it’s way higher. Now we have found TransferWise as a better alternative. So, we are using TransferWise for international business transfers at a lower rate.
Business Analyst @inkablelabel