PAYPAL is set to charge “inactive” users an annual fee of up to £12 a year – but there are steps you can take to avoid it.
From December 16 this year, PayPal users will be charged the fee if they haven’t used their accounts for at least 12 consecutive months.
PayPal defines “inactive” as an account where the user hasn’t logged into their PayPal account or used it to send, receive or withdraw money
If your account has been inactive for over 12 months, you’ll be charged the lesser of £12 or your entire PayPal balance.
For example, if there is £3 in the inactive account, the fee will be £3. If there is £20 in the account, £12 will be taken.
If you don’t have any money in your PayPal account, or your balance is negative, you won’t be charged a fee even if you have a debit or credit card linked to the account.
PayPal couldn’t confirm how many inactive UK accounts there are when contacted by The Sun.
MoneySavingExpert founder Martin Lewis warned about the changes on Twitter yesterday, writing: “Paypal users warning. It is going to introduce a £12 inactivity fee.”
It led to a flurry of comments from unhappy users, with one Twitter user adding: “Guess I’m deleting my PayPal account then.”
While another user tweeted: “Appalled to see that @PayPal is going to charge a £12/year ‘inactivity fee’ for accounts that have been dormant for a year.
“Preying on the unwary and unsavvy.”
How to avoid the fee
If you have a PayPal account but don’t use it regularly, you can easily avoid the fee by logging into your account or making a transaction before December 16, 2020.
This means your account will have been active in the previous 12 months, so you won’t be charged.
If you don’t use your PayPal account and don’t want to risk being charged in future, you may want to consider closing the account.
Once logged in, simply go to “settings” and select “close your account” at the bottom of the “account” tab.
Another option is to keep the account open but transfer any cash you have to another account, as you won’t be charged by PayPal in future if your account doesn’t have a balance.
The payment services firms told The Sun it’ll warn inactive customers that they could need to pay a fee, by sending them notifications 60 days, 30 days and then seven days before the fee is set to be charged.
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