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Patreon passes fees to Patrons - dramatically increases the cost of small donations

Pledging a $1 donation on Patreon will soon cost patrons around $1.37

Patreon passes fees to Patrons - dramatically increases the cost of small donations

Patreon passes fees to Patrons - dramatically increases the cost of small donations

Patron, the crowdfunding service for content creators, artists and musicians, has revealed some significant changes to the service, fundamentally changing how users fund their favourite creators.  

When users back a creator on Patreon today, their money is added to a pot which is eventually given to their chosen creator after certain deductions are mode. These fees Patreon's service fees and transaction costs, with this amount ranging from 7-15% of a creator's total earnings from the service. 

On December 18th, Patreon will change how these fees are deducted, asking users to pay for these costs upfront to ensure that creators get exactly what the user intends to pledge. This change makes Patreon's fee structure a lot more transparent, but it will have a considerable effect on those who pledge small amounts to creators.   

Many creators on Patreon have informed their users about this change today and have highlighted some major flaws in the system. The new system will charge users their pledge amount plus 2.9% and $0.35, which has a dramatic effect on small donations. After December 18th Patreon users who donate a dollar will be charged around $1.37, making Patreon fees account for 26% of the transaction, which is much higher than the 7-15% that creators typically pay in fees.  

This move incentivises large donations and will no doubt affect the number of smaller contributions that creators see on Patreon, which is something that is expected to have a more substantial effect on select creators. Those who primarily rely on larger donations will see some enormous benefits from this change, especially if average pledges are over $5.  

  

Patreon passes fees to Patrons - dramatically increases the cost of small donations  

Patrons who currently donate small amounts to a large number of creators will be hardest hit by this change, with this 2.9% + $0.35 fee applying to each donation. This means that someone who pays $1 to ten different creators will now pay around $13.79, whereas someone who donates $10 to a single creator will now be charged $10.64. 

Patreon's creators that rely on small donations will likely be the heaviest hit by this change, as many patrons are likely to cancel their pledges after finding the cost of their payments increase by over 20%. 

You can join the discussion on Patreon's changes to their donations and fees system on the OC3D Forums

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Most Recent Comments

07-12-2017, 09:52:11

notcool
I'll still use it alot of the channels I watch which are not PC(politically correct according to YT advertising) have been hit hard by recent monetisation changes. I pledge to about 6 or 7 with the top one being $5.Quote

07-12-2017, 20:38:23

MacLeod
Yeah this is a stupid and shortsighted policy change. It's like I give you $100 and you charge me $1 to take it. I cannot see how that is a proper business model. Patreon doesn't give us squat. They're just a middle man that takes our donations and gives it to a 3rd party. Why would I want to pay them to support a site, they're a service we don't need and could easily do without? I'd rather just support the site directly. The geniuses at Patreon seem to think that WE, the ones giving money away, are their customers and are due to pay some fees. The content creators are their customers and should be handling the fees. After all, the money they get from us is 100% profit so even if they have to pay 10% commissions, they're still getting 100% profit from the donations because they're DONATIONS.

If Patreon isn't careful they're going to price themselves right out of business cause I'm paying money to support sites I like, not Patreon.Quote

07-12-2017, 21:34:53

NeverBackDown
Never used this for anybody but I think people who donate should not have any fees. The person receiving them should be paying fees.Quote

07-12-2017, 23:50:41

MacLeod
Quote:
Originally Posted by NeverBackDown View Post
Never used this for anybody but I think people who donate should not have any fees. The person receiving them should be paying fees.
I like the idea of Patreon because it supports sites out there that offer up information that you really can't find anywhere else but they don't get the traffic and ad revenue larger sites do. Gamers Nexus for example has some of the most in depth and technical while still being understandable to the average Joe SixPack like me but they've got only a fraction of the traffic Linus does despite having articles that are light years ahead in information. I bought my motherboard based on their video on the best AM4 motherboards which went in depth about VRM's and the boards durability and that was the ONLY place I was able to find information like that about any AM4 motherboard. That's why I support them with a couple bucks a month.

So yeah, there are a lot of review sites out there that basically just read off a products marketing literature but have zillions of subscribers but channels and sites like Gamers Nexus and OC3D even, have much more in depth, practical and informative articles but a 1/5th of the subscribers. Patreon is a good way to support those guys who aren't as mainstream.Quote

08-12-2017, 02:45:56

Kleptobot
If you're donating to someone through patreon then a small increase in cost probably won't influence you that much, seeing as the spirit with which people donate is unlikely linked to monetary returnQuote
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