UPDATE: Patreon decided against rolling out the payment changes: https://blog.patreon.com/not-rolling-out-fees-change
So I received an email earlier from Patreon giving notice that it will change how the processing fee is handled. The relevant section of the email is replicated below.
Basically, the current (old) structure is that whenever you pledge, say, $5 to me, I actually don't receive the full amount. Patreon takes 5% and then there is this processing fee taken by payment processors. So on average, for each dollar pledged to me, I only get around ~88% of that amount.
Now Patreon is changing it's pledge system with the tagline "Creators now take home exactly 95%." That is good news right? Unfortunately the processing fee still needs to be paid by someone, and this time, Patreon decides that patrons (you) will bear the cost.
With the new system, when you pledge, you will pay this extra payment processing fee. This fee is set by Patreon to be 2.9% + $0.35. So for example, when you pledge $5 to me, you will actually pay a bit more than that. In the $5 case, you have to pay $5.495. But on the other hand, I will take home "exactly 95%" of $5, instead of a varying amount due to processing fees.
I have also calculated the extra cost for a couple different pledge amount points:
- $0.379 on $1 pledge
- $0.495 on a $5 pledge
- $0.64 on a $10 pledge
- $0.785 on $15 pledge
Patreon Email:
Any alternatives to Patreon? Maybe Western Union or in-country payment
ReplyDeleteNo real alternatives atm.
DeleteThe added cost being shifted onto the pledges is atrocious business for Patreon, it's going to turn off everyone pledging low amounts. The $1 tier may as well no longer exist.
ReplyDeleteThe processing fee is not that bad in my opinion, i mean you have to pay extra 40 cents, it's not that much for a monthly payment. For daily payments, sure that would increase the total amount by quite a lot, for monthly, not really.
ReplyDeleteSome people think the $.50 won't matter since it seems like so little, but that's a 10% increase over the current cost to pledge (which is pretty significant). There's also a psychological difference between seeing a $5 price tag and a $5.50. That being said, there's not much for you to do since lowering the pledge to $4.50 (does Patreon even allow decimals in prices?) results in about $83 less a month for you after their 5% cut. Either the patrons or the creator is losing after this change.
ReplyDeletePatreon doesn't allow fractional pledge tiers, and $1 is the lowest tier you can set.
DeletePatreon announced a reversal of this decision today
ReplyDeleteThanks for letting me know. Updated.
Delete