How to Reduce Your PayPal Fees for Tipping
If a portion of your income comes through PayPal tips, you could significantly lower your fees. This could save you hundreds or even thousands of dollars annually, depending on your tipping volume.
PayPal Fee Overview
PayPal's standard fee structure isn't optimized for the streaming environment.
While a 36-cent fee might seem negligible for a large payment, it can be a significant burden on numerous small tips. For example, on $1 tips, this fee can take a big chunk of your earnings. However, there is a way to reduce this fee to around 6 cents on small tips via PayPal's Dynamic Micropayments.
Dynamic Micropayments are specifically designed for those who receive frequent small payments. If you typically receive payments between $1 and $10, PayPal offers significantly reduced fees on these transactions, helping you keep more of your earnings.
Enabling Dynamic Micropayments
To take advantage of Dynamic Micropayments, you first need to ensure you have a PayPal Business account. Here's how:
- Log In to Your PayPal Account:
- Go to PayPal and log in.
- Check Your Account Type:
- Navigate to your account settings and see if your account is a Business account.
- If not, upgrade your account here.
- Upgrade to a Business Account:
- Follow the on-screen instructions to upgrade. This process takes only a few minutes.
Next, you need to request Dynamic Micropayments for your account:
- Go to the Message Center:
- Visit the PayPal Message Center.
- Open a Support Ticket:
- Start a new support ticket with the message: "I’d like to enable dynamic micropayments for my account."
- Navigate Through Prompts:
- When asked for help articles, select "No, I need more help."
- Opt to send your query to a customer support agent by choosing "Yes."
- Repeat Your Request:
- When prompted for details, repeat: “I'd like to enable dynamic micropayments for my account."
- Follow any additional instructions given by the support agent, and persist if necessary.
- Wait for Confirmation:
- PayPal will inform you that it will take a few business days to process your request. After confirmation, you can continue with your regular activities.
Note that with Dynamic Micropayments, PayPal will automatically choose the most favorable fee structure for you, ensuring you don't pay extra for larger tips.
Conclusion
By switching to Dynamic Micropayments, you can substantially reduce the fees on small tips, allowing you to retain more of your earnings. Follow the steps outlined above to upgrade your account and start saving today. Happy streaming!
