Concerning Changes to Patreon's Fee Structure · 1:14pm Dec 8th, 2017
So, Patreon has decided to do something absolutely nobody wants and restructure the way processing fees work. In a controversial move, Patreon has decided to change from having creators eat ALL the fees to "only" taking 5% of the pledged amount from creators--and charging a flat, per-pledge rate to all patrons.
For every pledge you have active, you'll be charged 2.9% plus a flat 35 cents. Meaning if you're pledging $1 to one patron, you'll be charged $1.38. And if you're pledging $1 each to a whole LOT of patrons...that's $1.38 per pledge.
It's bullshit.
Most of my patrons are reward-tier, and hopefully the impact of this will be less pronounced on them, but my smaller pledge patrons, while I would obviously love to keep you around, if you can't deal with this shit, I totally understand. Meanwhile, creators are uniting on Twitter to speak out against this. If you'd like to tell Patreon how awful this decision is, send e-mails or join the campaign on Twitter.
... I'm not sure I understand. Are they taking more from creators? Because it sounds like they're taking less from creators and asking the people pledging to support the site. I wouldn't be surprised if eventually they stopped taking from creators at all and just charged the supporters the flat fee. Isn't that what that bidding website does? The one in all the commercials?
I dunno. It just doesn't seem like a problem to me. If I have a dollar to spare, surely I can also spare an extra 38 cents.
My typical pledge for fimfiction authors is $3. So... now I got to pay 12% more. Or maybe to one author less.
The reasoning behind the fee is that, for creators who require an up-front payment of the first pledge, there were a lot of complaints (and refunds) because of people pledging near the end of the month then getting charged again at the beginning of the next month, so instead of doing all the pledges on the first of the month in one charge, they'll do them individually on the same day of the month they were pledged, which greatly increases the number of credit transaction fees that Patreon has to pay.
Personally I think there are far better ways they could do it without incurring a ridiculous number of transaction fees. They could have a first pledge count towards the next month if it were made past the midpoint, or they could prorate the second pledge (not the first, because that would let people pledge on the last day of the month for 1/30 of the amount, grab everything, then cancel their next full pledge.)
4744207
Maybe, but let's say you're pledging one dollar to, for example, twenty or thirty different creators. As Moth said in the initial blog post, you'll have to pay an extra 0.38¢ to each pledge, and that can add up surprisingly quick. (An extra $7.60 for twenty $1 pledges, an extra $11.40 for thirty such pledges, and so on and so forth.)
I looked over a breakdown someone posted on Twitter. If that was correct, in addition to the flat $0.35 per-pledge fee, there’s an additional 2.9%—which corresponds precisely to Paypal’s transaction fee. Looks like it may be Paypal that has Patreon over a barrel. I’m not sure what’s changed, though I’d hazard a guess there’s been some sort of renegotiation.
I certainly agree it would be easier and more convenient for pledgers and even, to an extent, for recipients if all fees were folded into a pledge amount. However, it’s possible there are laws in jurisdictions outside the United States that require certain types of fees be broken out separately—and trying to implement different methods for pledgers in different countries would be a nightmare if not flat impossible. As an example of how laws can impact commerce: in California, sellers are legally barred from folding sales tax into their prices, I believe; in Australia, as I understand it, sellers must fold sales tax into their prices.
4744207
It's a problem because a lot of patrons pledge $1 each to a bunch of creators, and with the new fee structure, a patron who pledges $10/mo across 10 creators is now pledging almost $14 total after fees. The more creators you're supporting, the more you get dunned in fees.
The creators are the ones who do not want this. WE want to keep having the fees taken out of OUR cut. Why? Because doing it the other way around will LOSE US PATRONS. Ever since this was announced, Twitter has exploded with horror stories of people losing so many patrons they can no longer afford their monthly bus pass. Or worse.
4744220
Yeah, they basically decided to solve the problem of raccoons getting into the garbage by burning down the house.
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There's no barrel here. This is something they've apparently been playtesting for MONTHS in secret. They seem to legitimately think this will be a good thing for creators. That's the thing here...they're not doing this out of malice or greed, they're doing this because they honestly don't see the harm it'll do to the people they think they're trying to help.
4744350
Fair enough. Certainly to outside observers the consequences, and perception of them, matter far more than the reasons for them, and I absolutely agree it’s inconvenient (to put it mildly) for contributors—the same way sales tax being added on rather than folded in is inconvenient, but to a much greater degree.
https://blog.patreon.com/not-rolling-out-fees-change/