PayPal Cuts Grandfathered Rewards Program to 1% Cashback
Longstanding users of the PayPal Business Debit MasterCard won’t be seeing as much cash back on their cards in the future. Starting July 1st, all PayPal business debit cardholders who were grandfathered in with 1.5% cashback will be dropped to the standard 1% rate that has been in effect for several years.
“A small number of customers continued to receive 1.5% cash back from a program which no longer exists,” said a PayPal spokesperson. “We continued to honor their original rate for several years and are now consolidating all cardholders to the standard 1% rate.”
The PayPal Debit MasterCard allows people who receive payments through PayPal to immediately use the funds in their account, without waiting for bank transfers that can take up to three days to complete. The user must have a PayPal business account in order to sign up, but there is no charge for upgrading to a business account. The card can be used just like bank debit cards to purchase items in stores, pay for restaurant bills and withdraw money from the ATM.
Under the cashback system, business debit card users are able to get 1% cashback for all of their purchases, as long as the purchases are run as “credit.” Of course, PayPal and MasterCard get a transaction fee from the merchant for all credit card purchases, so PayPal is enticing its users to pay with credit instead of debit. This doesn’t cost any extra on the user’s side, so it’s certainly worth the effort for those who use their cards regularly.
This change in cashback will not impact users who have a PayPal Extras MasterCard, nor will it impact any other terms on the card.