Patreon is to lower its percentage but apply a 35c fee to every transaction,
according to a confusing announcement that’s thrown the funding site’s
userbase into chaos. It sounds good for the platform’s stars, but
ruinous for creators dependent on dollar pledges.
The crowdfunding platform for artists currently takes a fee of 5%
(creators also pay fees charged by payment processors like Stripe or
PayPal) from each pledge. That changes on December 18, when patrons will
start paying 2.9% plus 35 cents for each individual pledge, according
to Patreon’s product update page.
Patreon says the reasoning behind its new policy is to let creators keep
a larger cut of each pledge. “With this update, creators will now take
home exactly 95% of each pledge with no additional fees,” the company
explained on its update page.
The 95% applies after the transaction fee, and a lot of the
confusion was over whether that thirty-five cents gets eaten by the
recipient (who then would get only 60 cents or so) or stacked onto the
donor’s dollar (thereby making them pay $1.35 or so). The latter is
reportedly the case, but either way, the only people benefiting are
whoever gets those enormous transaction fees.
From one user: “Patreon has decided to blithely insult the collective intelligence of their clientele with happy talk.”
It’s as much, or more, that @Patreon has decided to so blithely insult the collective intelligence of their clientele with happy talk.
If Patreon finally has to pass on the per-transaction fees that banks
impose to its users, that would be understandable. But one breakdown
identifies it as a shift mostly to Patreon’s own benefit.
And whoever there thought they could sell this as rainbows and unicorns
made a mistake so obvious maybe it’s not a mistake at all. Perhaps it’s
aimed more at investors or buyers interested in Patreon itself? This
would stand to reason, especially given its recent crackdown on adult
content.
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