LEHIGH ACRES, Fla — Small businesses who use payment methods like PayPal and Venmo now have a decision to make: Will they pass the cost of increasing transaction fees onto you? Or will they be able to take the hit?
Later this month, the transaction fee for Paypal will be 3.49% plus 49 cents. It will be 1.9% plus 10 cents for Venmo personal accounts.
To put those numbers into perspective for you, if you were to make a $500 purchase, the seller would lose about $18 using PayPal. With Venmo, they'd lose just under $10.
Local small business owners and those with side hustles say that can add up. And now they have a decision to make.
"Us, we're willing to take the loss if that's the case. But if not, if we need to raise our prices, we'll raise them. Not as much. We just want to be a unique kind of business where we don't charge as much," explained Caridad Marrero, Owner of Elevated Apparel by C&C, also known as Elevated Customs Inc., in Lehigh Acres.
Marrero said her small business offers both PayPal and Venmo as payment options for its customers.
Fox 4 did some research to try and gauge how these new fees compare to other processing vendors.
According to WalletHub, typical credit card transaction fees average 1.5% to 3.5% per transaction. The price merchants pay depends on a number of factors, including the card issuer and payment processor. The interchange fee is a percentage of the transaction amount, plus a flat fee.
Small businesses and those with side hustles who use PayPal and Venmo will see these increases starting July 20th.
