PayPal users will be charged a £12 fee from December this year if their account has been inactive for more than a year, it has been revealed.
Currently, users can open an account for free with the company, with money made from charging fees to merchants using the online marketplace.
However, from 16 December, both purchase and business accounts will be charged an “inactivity fee” on accounts.
What is an ‘inactive’ account?
An inactive account will be identified by PayPal if the owner has not logged on to the account or used it for sending, receiving or withdrawing money for at least 12 months in a row.
Accounts containing no money will not be charged, so if you have an idle account that is not linked to a bank account, you will not be charged the fee.
Accounts with less than £12 in them will see the remaining funds taken.
What PayPal has said about the change
PayPal has said that users in danger of being potentially charged will be warned 60 days, 30 days and then one week before any charge is implemented.
A PayPal spokesperson said the introduction of the charge was being made to help the company invest in services for its users.
“PayPal customers enjoy a range of benefits associated with their accounts, including a full suite of tools, products and support for sellers, and shopping experiences that include quick and convenient checkout for buyers,” they explained.
“As the value we provide our customers has expanded, PayPal continues to invest in our services, giving customers even greater opportunities to buy and sell globally.”
How to avoid being charged
To avoid being charged, users will need to log into their PayPal accounts, or make a transaction before 15 December 2020.
If you do not actively use your PayPal account and don’t want to run the risk of being charged, another safe option is to close your account.
This can be done by going to ‘Settings’ and selecting ‘Close your account’ at the bottom of the ‘Account’ menu.
Another option is to keep the account open, and transfer any remaining funds in it to another bank account. This will leave you with a balance of zero and will help you avoid the new fee.