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As the Covid-19 pandemic impacts businesses worldwide, global payments companies are starting to respond with relief. The latest is PayPal Holdings Inc., which on Tuesday announced several measures aimed at cutting fees and deferring loan payments for merchants. More than 24 million businesses accept payments or other services from PayPal. All of the measures announced Tuesday are good through April 30, and may be extended beyond that date, the company said.
In a move to cut costs for immediate availability of funds, PayPal is waiving fees through April 30 for instant transfers from the merchant’s PayPal business account to a bank account or card. Normally, the fee for instant transfers is 1%, up to $10. PayPal is also waiving fees for chargebacks filed by customers with a credit card issuer through April 30.
In a related move, PayPal also said it is extending from 10 days to 20 days the window during which merchants must respond to a customer dispute.
On its PayPal Business Debit Mastercard, the company is doubling the cash-back reward, which is good on eligible purchases. The reward normally is 1%. Eligible purchases exclude “transactions processed as cash withdrawals, cash advances, or those using a PIN or transactions that the merchant processes as PINless debit,” according to terms for the card.
A fifth measure allows merchants to request to defer payments at no fee on business loans and cash advances.
PayPal’s top management hinted further actions may be on the horizon. “We are taking immediate steps to help our small-business customers who are most impacted by the coronavirus pandemic to help them navigate these challenging times,” said Dan Schulman, PayPal’s chief executive and president, in a statement. “This is just the beginning. We are actively working with governments and private sector partners to help support businesses in this time of need.”
An estimate of the total cost to PayPal of the five relief measures announced Tuesday was not immediately available. With respect to the impact of the pandemic, PayPal in late February estimated its year-over-year revenue growth rate for the first quarter in its cross-border e-commerce business would be one percentage point down from guidance given a month earlier. That drop, the company said at the time, was being “partially” offset by stronger growth in other parts of its business.
