On Thursday, Barclays (LON:BARC) maintained its Overweight rating on shares of PayPal Holdings Inc (NASDAQ:PYPL) with a steady price target of $92.00. The firm focused on PayPal's recent announcement regarding the amendment of its User Agreement, which detailed several pricing updates for U.S. merchants. These changes are set to take effect on January 13, 2025.
PayPal's pricing update includes a notable increase in fees for its Pay Later service. While merchants were not previously charged extra for using the Pay Later option, only incurring the standard PayPal Checkout fee of 3.49% plus a fixed fee, the new structure will raise the cost to 4.99% plus a fixed fee. The fixed fee remains unchanged at $0.49 for transactions in USD and €0.39 for EUR.
The company has also adjusted the pricing for Alternative Payment Methods and Advanced Credit and Debit Card Payments. The fees for these services have been revised to 2.89% plus a fixed fee, increased from the current 2.59% plus a fixed fee. The fixed fee for these transactions will be $0.29 for USD and €0.19 for EUR, marking a decrease from the current fixed fees.
Additionally, PayPal has updated its Virtual Terminal pricing. The new rate will be 3.39% plus a fixed fee, up from the current 3.09% plus a fixed fee. The fixed fee for Virtual Terminal services has been reduced to $0.29 for USD and €0.19 for EUR.
The timing of these updates is strategic, as they are scheduled to take place after the holiday spending season. This suggests PayPal's consideration for merchant sales during the high-traffic period. The revised pricing structure is anticipated to impact merchants who utilize PayPal's services for transactions.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.