PayPal has announced controversial new plans to charge customers and businesses “inactivity fees” if they don’t use their account for extended periods.
The payments giant will begin charging £12 per month for accounts left inactive for over 12 months, starting from December 26 this year.
PayPal will identify an account as “inactive” if no one has logged in, sent or received money for over a year.
Only accounts with funds in will be charged, and PayPal will not access connected bank accounts to take funds.
— Richard Tubb (@tubblog) October 18, 2020
So @PayPal are gonna charge for inactive accounts. But if you delete your account its gone for good and can't be reopened….. Great business strategy guys. Only option is to close and never use
— Luke (@Milky_The_Gamer) October 14, 2020
Time to close your Paypal .. it was pretty useless anyway.
PayPal users will be charged a £12 fee from December 16 if their accounts have been inactive for more than a year. The charge means if you have £12 in your account, it will be debited accordingly
— Denis the Menace #TimetoChange (@DenisonChapman) October 14, 2020
Accounts will balance over £12 will be charged the whole fee, but accounts with under £12 will have their entire balance deducted.
The new fees, which PayPal has not yet given a reason for introducing, have already sparked a backlash on social media with many customers stating their intention to “get rid of” their accounts.
It comes alongside announcements that PayPal is bringing its ‘buy now, pay later’ scheme to the UK with its Pay In 3 option.
This new scheme poses a major threat to established payment firms like Klarna, as PayPal has a vast inbuilt audience of both retailers and shoppers.