3 ms·
The reason to have fees as a percentage vs a flat fee isn’t because costs scale with payment amounts, it’s because it’s a more fair way to levy fees. I can eith
by e-clinton 4y ago
The reason to have fees as a percentage vs a flat fee isn’t because costs scale with payment amounts, it’s because it’s a more fair way to levy fees. I can either charge everyone $3/transaction, even if the transaction itself is less than or equal to $3, or I can structure it as a percentage to encourage smaller transactions. If people think Patreon is making a killing with their fee structure, they should build a competitor.
- deleted 4y ago[deleted]
- mdavis6890 4y agoStill, why is a percentage more fair? What definition of 'fair' are you using? "If people think Patreon is making a killing with their fee structure, they should build a competitor." >> Yes! And honestly this could be applied in so many places where people like to complain, and yet nobody builds a competitor, or they do and it ends up looking like the original. So easy to complain, so hard to do better.
- e-clinton 4y agoIf Patreon took 75% commission of small payments, people would be outraged and quit the platform. You’re right that “fair” can mean many things, but a percentage is, in my view, the least objectionable way to do it.
- acchow 4y agoHow are you defining "more fair"? By having the larger transactions subsidize the smaller transactions, how is that "more fair"?
- permo-w 4y agofair is the wrong word. it's certainly more practical
- markdown 4y agoFair would be to charge the lower of $X or X%.
- 1123581321 4y agoYou would need to increase the percentage in order to make this change.
- remus 4y agoIf each transaction has a fixed cost but as a payment processor you're charging a percentage fee that seems like a risky business. What happens if the mix of payments on your platform tends towards lots of small transactions?