There is serious change afoot at the global payments company.
On Friday, PayPal announced a raft of new changes to be introduced to its suite of payment products and services.
The news was shared by Dan Leberman, Senior Vice President, SMB and Partners at PayPal in a post hosted on the company’s US newsroom. Leberman said the price hike was required “to better align our pricing with the value that our products and services provide”.
While currently focused on only a portion of US customers, the increases will be applied to a range of existing payments including PayPal Digital Payments, In-person Payments, Credit and Debit Card payments and Charity Transactions.
The announcement comes amidst a variety of news at the global payments company. Last week the business announced it will enter the Australian credit card market in July, with the launch of a Visa card issued through an arrangement with Citigroup.
This was preceded by an attempt to tap into the growing Buy Now Pay Later market with a new “pay in four” instalment option, available to its nine million Australian customers this month.
While the two moves appear at odds with one another, the company is hedging its bets by betting on both the rise and decline of credit card usage.
Andrew Todd, General Manager of Payments at PayPal Australia, said at the time of the announcement “There’s no silver bullet option that’s preferred by all Australians, so we want to ensure that however customers prefer to pay, they can choose to do it with PayPal.”
Finder reports that Australians spend on average $25 billion in credit card payments each month, with the Buy Now Pay Later listed entities processing around $10 billion of purchases in Australia and New Zealand in 2020.
Numbers from the Reserve Bank of Australia showed that the total number of credit cards on issue fell to 16.96 million in December 2020 from 18.78 million in the prior-year period.
Changes to PayPal’s pricing will take effect as of 2 August, 2021.