eBay Says It's Making Express Payout Simpler, But Watch Out- It May Be More Expensive Too
eBay has announced changes to their Express Payout offering, promising it will make the process "simpler" while glossing over the fact they are also making it more expensive for some sellers.
Sellers received the notice in an email, advising as of July 1, the fee for Express Payouts to a debit card will be changing for the previous 1.5% to a flat rate $2.
It's not clear what exactly eBay believes is "simpler" about this change, as Express Payouts to debit card have always provided access to funds within 30 minutes even on weekends and holidays since the feature was introduced in June 2022.
In fact, the only actual change reflected in this email is the fee structure.
With the previous fee model based on a percentage, sellers were charged 1.5% of the total funds being transferred, capped at $15 per withdrawal.
That means anything up to ~$130 would have previously cost less than $2 in additional fees to transfer via Express Payout.
By changing to a flat rate fee structure, sellers will now either have to pay more for express payouts of lower amounts or wait longer to accrue more funds before withdrawing (allowing eBay to collect additional interest on the funds) - neither of which is likely to be considered "simpler" by most sellers.
In typical eBay fashion, the page linked to in that email to "get more details" has not been updated yet and is still reflecting the current fee structure, so it's unclear if the $5 minimum will remain the same but I'd say it's likely it will.
Mercari recently faced pressure from angry sellers and a slew of FTC complaints when they unceremoniously changed their payout terms to require a $2 for standard ACH payouts without proper notice to sellers.
Liz Morton
It appears eBay may have learned a few things from watching their competitor's struggles, both in terms of fee amounts and in seller communication.
Importantly for eBay, standard ACH payouts are still free from any additional charges at this time and sellers will only be charged a fee for using the optional Express Payout to debit card if they choose to do so to gain faster access to funds.
eBay has recently been conducting surveys about payments and financial services, gauging thoughts on funds availability, fee structures, access to capital and other features, though I'm not sure this change to the Express Payout fee would have high on sellers' priority lists to tackle first.
Ever since the rollout of Managed Payments, sellers have been pressing eBay to provide missing features and functionality they used to have with PayPal.
When eBay first introduced Spendable Funds (the ability to use sales proceeds immediately for purchases on the platform) to the US in 2022, many sellers said they'd be much more likely to leave their funds on account or use them for purchases if they could earn rewards points and/or have a debit card linked to their eBay Payment Account just like they used to have with the PayPal Business Mastercard that would allow them to use those funds for off site purchases as well.
Liz Morton
Earlier this year, eBay dropped LendingPoint as their seller capital loan partner in the US, pivoting to Funding Circle, which they were already using in the UK market.
Through Funding Circle, eBay is able to offer UK sellers loans with payback terms based on a percentage of sales, rather than fixed monthly payments, similar to the way PayPal Working Capital loans used to work - another feature US sellers have been anxiously waiting for eBay to make available.
Liz Morton
And of course, sellers are sure to see the irony in the timing of this fee increase for Express Payouts as eBay just announced last week it is ending its acceptance of American Express due to "unacceptably high fees."
Liz Morton
What do you think of eBay changing from a 1.5% fee to flat rate $2 for Express Payouts to debit cards? Let us know in the comments below!
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