Why PayPal charges a fee is simple: PayPal is a business that wants to stay in business.
A helpful meeting place opens, so you go there to check it out. It’s available for business use and personal use, and it has a really great feature: there is no charge for personal use! You can go there and meet with friends, and it’s free. The place is open 24/7/365, too. Because they maintain the place well, it stays nice and clean. All you have to do is show up, use it, and leave (ideally without breaking anything).
You like it, and you want to make use of it. You sign the contract saying you agree to follow the rules. The rules are pretty simple. The pertinent ones for this story: You may use this meeting room for business or personal use. If it’s for business, there is a fee. If it’s for personal use, there is no fee.
That business used to be PayPal. But too many people lied, cheated, and stole from PayPal by fraudulently using the Friends and Family feature for business transactions.
Lying to avoid fees
Some of the people clearly conducted business in there, lying on their way in, saying, “This is a personal get-together. This is, um, my cousin. Yeah, I know, it’s the thirtieth cousin I’ve brought here this month.” It’s obvious to everyone that they are lying, cheating the system, and stealing from the business that is so graciously providing the meeting place for them to use. You’re aware of what’s going on. So many people didn’t understand why PayPal charges a fee.
You’ve used the place for a couple of quick meetups with friends who needed your attention, but then one day, you go there to conduct business with a client. Do you say it’s for personal or business use?
Teaching kids honesty
Years ago, I presented this to my children when we were on the way to the dentist. I asked them what they would do.
Every one of them made the right choice. I wasn’t a bit surprised, because we’ve taught them their entire lives, but it’s always a relief to hear them give the moral response (and even better to see them do it when they think no one is looking).
Then we discussed consequences of saying it’s personal when it’s really business, including having a guilty conscience—and that trumps all else. It doesn’t matter if there are no other consequences for doing something wrong; you will know, and God will know, and there is no escaping either.
But there are other consequences: people who try to cheat the business that is so graciously allowing them a place to meet could be banned for life from going there. They could be fined or arrested for theft. They are making it clear that they are liars, cheats, and thieves; honest people don’t want to have anything to do with them. If someone would lie, cheat, and steal over something so trivial as a tiny usage fee, then they would lie, cheat, and steal when larger amounts of money are at stake, too.
My family also said things such as “After all, that place is a business, and they deserve to be paid for what they do, just as you deserve to be paid for what you do.” Absolutely. Without even knowing which company I was talking about, they knew why PayPal charges a fee.
“It’s nice that they allow personal use to be free; they don’t have to do that.” I agreed.
“The place could also start charging everyone, even for personal use, because of the thieves.” Yes, they could.
Why PayPal charges a fee for Friends and Family now
And, thanks to the liars and thieves, PayPal did exactly that.
This situation came up often in the business world, whether it was colleagues lying to avoid paying the fee or clients who were trying to save me money by encouraging me to lie. I addressed it the same way every time, regardless of whether I was the buyer, seller, or observer. I told them that paying fees is part of doing business. We should be happy to pay for valuable services we use. Rules are rules. Theft is theft, and theft is a crime.
- If the new client didn’t understand after an explanation, I dropped that client.
- When someone I was purchasing from didn’t understand that, I backed out and never purchased from them again.
- When a colleague didn’t understand, I cut ties with that person. Real editors should have a strong sense of ethics, so I distance myself from those who do unethical things.
Who pays the PayPal fee?
The seller or service provider pays the PayPal fee. It’s a cost of doing business.
It’s against the rules to make the customer or client pay that fee. It’s a cost of doing business.
Look, here comes a consequence
PayPal now charges a fee even for friends and family, but there may be other places that still offer some things for free. Do what is right. If you agree to something, abide by that agreement. Follow the rules. Don’t lie, cheat, or steal. Because consequences come whether we want them or not.
Ideally, your conscience is all you need to get you to make the right decision. If it’s not, then consider the other consequences you might incur. I tell people who lie to avoid fees, “Think about the harm that might come to others as a result of your crime,” but it’s obvious that they don’t care about the negative impact on others, or they wouldn’t be stealing in the first place.