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Patreon, a platform that allows "patrons" to give money to directly to artists and other content creators, is adding a processing fee to what patrons pledge, which could drive users away:
Patreon is defending a new payment structure that critics say hurts smaller artists. The change, which goes into effect on December 18th, adds a processing fee to each individual patron pledge, instead of taking the cut out of creators' total earnings. Because this fee includes a flat 35-cent charge on top of a percentage, it disproportionately affects people making small pledges, or pledging to multiple artists. Artists have complained that they're losing patrons after the announcement — but Patreon says it's an inevitable consequence of some other changes to the platform.
Patreon initially said that this fee made artists' earnings more predictable, because they'd only have to worry about a single 5 percent cut taken by Patreon. In an update, however, the company said that's not all that's going on. It's apparently linked to a minor-seeming change in when Patreon processes pledges.
Previously, Patreon charged for most pledges at the start of the month, but also let artists charge first-time backers as soon as they pledged. People seemed to be "double-charged" if they signed up toward the end of a month, so Patreon switched to charging them at the monthly anniversary of their initial pledge. Patreon says that means that more individual transactions are being processed, which jacks up credit card fees. (To make things even more complicated, some people pledge per-video or per-post, adding more rounds of payments.) So rather than dramatically cutting how much money creators get, it's passing that fee to backers.
[...] Some critics have characterized this as a deliberately exploitative or bad-faith move from Patreon; a widely cited thread by author Chris Buecheler suggests that the platform is under pressure from investors. But Patreon has also simply spent a long time struggling with its payment system. It introduced upfront payments — the source of the "double-charging" issue — because artists complained that patrons would sign up for perks and cancel before their first payment. Now, it's apparently trying to solve a problem with that system, and creating another issue in the process.
One of the common solutions for someone getting demonetized on YouTube? Start a Patreon.
(Score: 2) by urza9814 on Monday December 11 2017, @06:02PM
I got the email from them explaining what was going on. I'm not having such a problem with it since I'm familiar with the difficulties of payment processing. They've got a difficult system going on and they've got to streamline it. 35c isn't a huge amount, or unreasonable, and 2.9% is basically industry standard.
Yup, fully agreed. IMO this is what Patreon *should have done from the start*. This isn't Amazon.com, you aren't comparison shopping for the best price on some product...it's about contributing to support some artist or project you love. It's a money transfer system, not a storefront. If I went to Western Union and asked to send a $200 transfer, and when it got there it was $189.60 because they pulled their fees from the transfer, I'd be pretty pissed off. The fees are supposed to be charged separately so you can know how much the person on the other end is actually getting.
Interestingly, that part I didn't know about, it doesn't seem like Patreon actually communicated that anywhere. And that kinda defeats the entire purpose of the site, doesn't it? The point I thought was that I could line up a bunch of small pledges, and Patreon would bill me once and distribute it accordingly. If they're now going to billing me some random amount on random days every month that's a pretty big problem IMO. And if they're going to go that route they *definitely* need to come up with an alternative to continue to allow fixed monthly billing.