Paypal to charge £12 fee on ‘inactive’ accounts & how to avoid it

1 min Read Published: 15 Oct 2020

Paypal to charge £12 fee on 'inactive' accounts & how to avoid itPayPal is set to shake up its terms and conditions, levying a £12 charge on accounts it deems to be "inactive". In a move that will potentially affect thousands of users, accounts that haven't been used for a year or more will be subject to the annual fee, which will be automatically debited from the account balance.

When is PayPal introducing the £12 charge?

PayPal, a market leader in fast and secure payment services, has announced it is going to implement the new charge on 16 December 2020. This means if you have a personal or business account that you haven't used over the previous 12 months, you will have to pay the fee, unless you take action on or before 15 December. Following that, if your account remains inactive, you will liable to pay the charge again after another 12 months has elapsed.

Who will have to pay the £12 charge?

PayPal has defined "inactive" as an account that hasn't been used for 12 consecutive months to send, receive or withdraw money. You will, however, be exempt from the charge if you have logged in to your account, even if you didn't then use it for any transactions.

On and after 16 December 2020, users will be charged the lesser of £12 or the balance of your PayPal account. If you don't have any money in the account or if your balance is negative, you won't be charged a fee. This is the case even if you have a credit or debit card linked to the account. This means that, if you have less than £12 available in the account, you won't be pushed into a negative balance by the fee.

How to avoid the PayPal charge

  • Log on to your account on or before 15 December 2020 and set yourself a reminder to access your account at least once a year
  • If you don't regularly use your account, consider closing it by going into the "Settings" section of your online account (not through the app) and selecting "Close your account"
  • Transfer any money you have into another account, as you can't be charged if you don't have any funds in the account
  • Make sure you act if you get a notification from PayPal telling you that you will be charged for an inactive account. They will be sending users reminders 60 days, 30 days and 7 days before making the charge
  • Consider using an alternative service altogether, such as Amazon Pay, Apple Pay or Google Pay