Patreon Processing Fee and Deceptive Explanations (Patreon)

This update is to serve as both an alert to upcoming Patreon changes for my patrons and explain why the official email they are sending out is incredibly deceptive.

First off, the changes:

Patreon previously charged the creator exactly what it cost to process payments and added that fee to what we owe Patreon from our income at the end of the month. That fee was tacked on with a fixed 5% fee that went directly to Patreon every month. The amount of my income that the payment processing fees took up was usually in the range of 4-5% (despite Patreon claiming it being 7-15%, I know no one who has payment processor fees that high).

After this month processing fees will be applied to the person pledging on Patreon which means you will be charged an additional 2.9% + 35 cents on every monetary action on Patreon.

If you pledge to me at $1 you can expect to pay $1.38~ after the changes, if you pledge $5 you can expect to pay $5.50.

This isn't something I can control and I apologize!

Patreon is a significant source of my income at this point and I'm not sure there is anything I can really do besides alert you and tell you if you don't like the changes to let Patreon know by sending support an email or contacting them over their helpdesk to let them know your displeasure.

Overall these changes won't have a big impact on most people, they are in the cents range for most transactions and I imagine if I'm the only creator you are backing you'll probably only see a 30-50 cent increase. However the email they are sending out to alert people about the change is incredibly deceptive, if you are interested in why, continue reading below.

Patreon claims that they are making this change to save creators money so that they have more access to every dollar being pledged, however what they are not informing people is that they are increasing all fees by around 10-15% as they do this and that extra fee increase is not going to pay for processing fees, it is going directly to Patreon.

Prior to this change fees were processed in bulk in order to save money for creators, if you pledged to 100 creators, Patreon would charge you all at the same time in order to save on flat rate processing fees like Paypals 35 cent charge - a single percentage processing fee plus a small flat charge isn't a big deal when done this way.

Now, after the changes, each of those 100 creators will split into their own Patreon charge and Patreon will charge you 35 cents + 2.9% on top of that in order to cover the fee.

If all 100 of those creators you backed were $1 pledges, Patreon just made an extra 35 cents x 100 off of you, $35. More than 35% of the amount you paid to process payments for creators instead goes straight into Patreons pocket.

Every transaction on Patreon is now separated like this despite the fact that Patreon still charges people in bulk to save money. Now that saved money goes straight into Patreons pockets instead of to lowering total fees for creators. You are going to see upwards of 20% of the revenue generated on many campaigns being turned into profit for Patreon itself in the form of fees, this is a price hike and a huge influx of money for "processing fees" that don't actually exist.

In fact, if creators charge per creation each creation will be charged a flat fee despite the fact that all charges go through at the end of the month in bulk! This is a huge scam.

They are also using the most expensive transaction possible as the baseline for fees, Paypal 2.9% + 35 cent fee, many payment processors don't even have flat fees like Paypal, so if you were previously using a credit card with no flat fee charge, you'll now see Paypals fee being applied instead which is far higher for low currency charges.

Every month when the money I pledge to creators goes through it is taken directly out of my Patreon funds, the money I spend is already in Patreon. There is no payment processor fee. After this change I will suddenly be charged an extra $10~ every month for fees that don't actually exist.

Patreon is not doing this to help creators, they are doing it because it's an exploitable revenue stream they can trick people into paying for. All the while banking on everyone feeling too guilty to cancel their pledges because the real people that get punished are the people you want to support and there won't be enough upset people to significantly impact them and change their mind.

Previously, minimizing processing fees was a feature designed to get creators the most money from their pledges, now they are not trying to reduce and optimize processing fees because overflow cash from processing fees is profit, not savings for creators.

If you read this, please let other people know, or link them here, this is scummy business (especially pretending you are doing it for creators) and will especially impact both creators who pledge to other creators and anyone who uses the pay per post feature, as well as all patrons who like to pledge small amounts to multiple people.

Yes, I technically get more money from this, but it is going to penalize every user on this site much more.