New York (The Verge) — PayPal reinstates controversial policy of pocketing fees from refunds theverge.com/2019/9/20/2087….
PayPal is reinstating a controversial policy around its handling of fees in the event of a refund. Starting next month, PayPal will begin pocketing the initial 2.9 percent commission fee sellers forfeit during a transaction even when the seller is refunding a customer in full.
PayPal is one of the most used online payment and financial services companies on the planet. Originally co-founded by Silicon Valley titans like Elon Musk and Peter Thiel, the company had a successful initial public offering in 2002 and was that same year purchased by eBay for $1.5 billion, at the time one of the largest tech industry acquisitions in history. Ebay eventually spun PayPal off as a separate public entity in 2015, and the company has remained a major player in the online payments sector. In addition to providing the financial infrastructure and checkout process for millions of merchants and websites, PayPal also owns Braintree, the parent company off peer-to-peer payments app Vemmo and a substantial player in mobile payment processing.
But PayPal appears to be cutting costs with its new fee policy, just as primary competitor Stripe is emerging as one of the most valuable privately held tech companies in the industry. PayPal remains many times larger in valuation and market share than Stripe, but the San Francisco-based company has grown considerably in the last decade and is now a significant challenger to PayPal alongside Square and Amazon’s digital payment arm. — Nick Statt/@verge