Payments processors PayPal and Venmo have announced some significant changes to their crypto offerings. Both companies had began offering users a way to pay with crypto in the past year and have recorded a lot of success doing so. It had put in place various ways to charge for cryptocurrency transactions, both a flat fee and a percentage cut. Now, both payment apps are switching up the way they charge.
PayPal Taking A Larger Fee
Previously, both PayPal and Venmo charged their customers for crypto transactions according to the amount they were transacting. It was a flat fee for transactions that were under $25, taking a minimum of $0.50 on each transaction. Transactions larger than $25 saw both payment processors take a percentage cut out of each transaction. And for volumes between $100.01 and $200, a percentage fee of 2% was charged.
With the recent changes, the payments platforms are changing the way they charge for larger transactions. According to its announcement, from March 21st, all crypto transactions up to $200 will incur a flat fee.
Purchases between $1 and $4.99 will be charged $0.49 for each purchase, with no exceptions. Transactions of $5 up to $24.99 will be charged a flat fee of $0.99. Moving higher, transactions between $25 and $74.99 will attract a flat fee of $1.99. While transactions between $75 and $200 will carry a flat fee charge of $2.49 for all users.
The new flat-fee charges could be beneficial for some while also becoming more expensive to transact for others. Users who carry out smaller transactions would find themselves paying more. As for those who carry out larger transaction volumes, this would be beneficial to them.
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For transactions larger than $200, there will be no change to their fee structure. The flat fee rates for transactions under $1,000 are still a 1.8% fee and 1.5% for transactions greater than $1,000.
A PayPal spokesperson said that the changes will go into effect next month on March 21st at 9:00 AM Central Time. They reiterated PayPal and Venmo’s continued commitment to transparency, saying, “This change is part of our ongoing commitment to provide transparency, ease of understanding and clarity to our customers.”
PayPal had begun accepting cryptocurrencies back in 2021, first allowing U.S. users to access this feature, later expanding into Europe when it announced UK users were now able to use crypto on the app. Venmo had followed not long after in April 2021, implementing a crypto feature on its app.
Featured image from PayPal Newsroom, chart from TradingView.com