If you’re using PayPal, then you should know by now that they are, by far, the best payment processor out there, simply because their discount rate is very reasonable and you don’t need to pay merchant fees for their non-API model.

Not only that, things get better the more you use PayPal, since the more money you get paid through PayPal, the less the discount rate is. For example, if you make more than $3,000 in monthly transactions (before applying their discount), then your discount rate will be something like 2.5% (down 0.4% from the basic discount rate), which is extremely reasonable.

Now, will that happen automatically? In other words, will you get the new discount rate automatically once you pass the $3,000 threshold during a certain month?

Unfortunately, no, you will need to call PayPal to get the new discount rate, and the new discount rate will only be applied as of the next month. For example, if you made $3,000 back in May, then you will get the new discount rate in June. Note that in this scenario, if you call them in June to get the new discount rate, then they will apply it immediately (however, it won’t be retroactive on the previous transactions that occurred in June). If you call them in May, then the new discount rate won’t be applied until June 1^st.

But, what if, in a certain month, you make less than $3,000 in sales through PayPal? Well, then you will go back to the 2.9% discount rate. However, once you make $3,000 in a certain month again, then the lower discount rate will be automatically applied in the month that follows, without you having to call PayPal again.

What’s even nicer about PayPal, is that you will even get a better discount rate once you break the $10,000 and the $100,000 thresholds. You can check all the discount rates here.

Note: If, after reading this post, you start getting ideas about buying some PayPal stock, then don’t. PayPal is a private company, and the bigwigs there are happy with the structure of the company, and they certainly do not need any additional money from outside.

This article (as well as all other articles on this website) is an intellectual property and copyright of Fadi El-Eter and can only appear on fadi.el-eter.com.