PayPal is putting an end to fee-free Friends & Family payments for business accounts in the US by the end of July.
People who use it for business purposes, need to create a personal account for the fee-free payments.
Currently, PayPal offers two methods of payments; Friends & Family and Goods & Services. The first category is for personal payments which do not have any charges but also does not offer protection from scams. Whereas, Goods & Services for payments related to businesses and is a charged service along with the benefit of protection.
According to The Verge, customers often do their business payments through the Friends & Family option to avoid charges. However, in an announcement posted on the website, PayPal mentioned the change in its policy for fee-free payments which is applicable from July 28th, 2022.
As per PayPal, “In the coming weeks, U.S. customers will now only be able to send Friends and Family peer-to-peer payments to consumer PayPal accounts.”
As a result, those customers who have their businesses, need to set up an additional personal account to do any transactions with friends and family. Moreover, the new policy has also revised the charges for transactions. Previously, the charges were 2.89 per cent plus $0.49 per transaction, but starting July 28th, customers will pay 2.99 per cent without an additional flat fee.