Plastiq: PPBDC Now Being Treated As A Credit Card – 2.5% Fee Applies

Plastiq has been a popular way to pay bills and rent using a credit or debit card. Recently the service stopped earning 3x points on rent/mortgage payments with the Chase Sapphire Reserve. In more bad news it seems that the Paypal Business debit card is now being treated as a credit card and the 2.5% fee applies.

According to this text exchange it’s an intentional change as the PPBDC is treated as a credit card by their processor (meaning higher fees for Plastiq). I suspect that also means the 3x point change is here to stay and Plastiq has been looking to cut costs.

 

Hat tip to reader Vic J

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Andrew
Andrew (@guest_417719)
June 9, 2017 12:09

I wonder how many customers they lost as a result of no longer coding as 3x…

chaseaholic
chaseaholic (@guest_418494)
June 10, 2017 13:57

Do you or anyone else know how much the Visa Infinite category charges more?

Based off of this: https://usa.visa.com/content/dam/VCOM/download/merchants/visa-usa-interchange-reimbursement-fees.pdf

it looks like it’s treated the same as Visa Signature which seems wrong to me – anyone else care to chime in?

Either way, my amateur reading shows that Plastiq is probably eating ~2.2-3% in fees for processing our cards. With 2.5% fee only that is a razor thin margin esp. when you add in the FFD’s…

Jeremy l
Jeremy l (@guest_417712)
June 9, 2017 12:00

I can pay rent with Radpad, but anybody have suggestions for car payments now?

Jed
Jed (@guest_417688)
June 9, 2017 11:18

I’d been using PPBDC to liquidate my paypal account (mostly from kiva repayments) for quite some time. If they charge 2.5%, that will end for me immediately.

Kevin
Kevin (@guest_417660)
June 9, 2017 10:05

PPMC is basically dead anyway so this is disappointing but doesn’t have much real impact as far as I can tell…

CtownBin
CtownBin (@guest_417669)
June 9, 2017 10:27

You don’t need to fund your PayPal account with PPMC in order to benefit from using the PPBDC to pay rent via Plastiq. Before this change, people were using the PPBDC to pay rent and earn 1% cash back in the process. Nothing to do with how the PayPal account is funded.

Jay
Jay (@guest_417673)
June 9, 2017 10:41

Yes, but what would be the point of doing that when the 1% Plastiq debit card fee offsets the CB?

This was a pretty popular method of liquidating PP balances that were risky to transfer directly to a bank account, but I didn’t think there would be any incentive to use PPBDMC here if you weren’t trying to liquidate. The normal bill pay routes would go through much faster and have less chance of the delivery being lost.

Red
Red (@guest_417696)
June 9, 2017 11:31

Cashback for PIN-less Debit on the PPBDC has been dead for a while now.

CtownBin
CtownBin (@guest_417716)
June 9, 2017 12:05

Thanks for alerting me to this. Does it not work for loading Serve either? Back before my original Serve got shut down in 2016, it was working fine for 1% CB. I just got a friend’s Serve to manage and was going to start those loads up again- will I no longer get the 1% back loading Serve? It used to be run as regular debit and not PIN-less debit, which is why it used to work. Thanks.

JASON
JASON (@guest_417874)
June 9, 2017 14:17

PPBDC still works for loading on BlueBird and Serve.

This is how it works out in the past:

1. Buy PPMC @ CVS with your preferred CC. Even with Citi Double Cash you are still earning 1% because the fees of $500 PPMC is only $3.95, cheapest in all $500 giftcard such as visa debit or master debit. Especially in this quarter where Chase Freedom offers 5% on max to $1500 on drugstores/supermarkets, you would be already gaining $75-$3.95X3=$63.15 per card. And if you have a UF or CSR, product change it to Freedom.

2. After purchase of the PPMC, wait about 40-60 mins, then load it onto paypal account. Using PPBDC to pay on plastiq, CB on PPBDC will be posted the following month by 10th and that can compensate fees paid to plastiq. That being said, you’re basically paying with your CC so no need to use CC to pay bills through plastic directly. That being said, I don’t even care what promo or how much fee free points I have, I wouldn’t be paying any fees at the end.

Cashback for PIN-less Debit on the PPBDC have never been dead. You can still load Blue bird/Serve and I confirm that as of last month, I still get my cashback from Paypal. And since last October when Plastiq had issue with VGC I had already stopped using Plastiq. Now knowing that they code PPBDC as credit so I will recommend everyone to avoid using Plastiq. Got something to say, Rebecca@Plastiq?