Posted in: Comics | Tagged: crowdfunding, HRL, kickstarter, Patreon

Patreon Changes Fee Structure, Adds Service Fee for Patrons

Published Fri, 08 Dec 2017 11:30:34 -0600

Patreon, the crowdfunding service that allows patrons to support their favorite artists, writers, journalists, or other creative types with a small monthly pledge in exchange for exclusive content or rewards, is making a change to its fee structure.

The service has become popular in the comics industry, where across the board as a general rule, nobody makes the money they ought to be earning for their work. It's become so popular, in fact, that competitor Kickstarter recently announced a reboot for their competing service, called Kickstarter Drip, that performs basically the same function as Patreon.

On their blog, Patreon lays out the changes:

Starting on December 18th, a new service fee of 2.9% + $0.35 will be paid by patrons for each individual pledge. (To get into the details, existing per-creation pledges for posts made on/after Dec. 18th will be charged the new service fee; existing per-month pledges will first be charged a service fee on January 1.) Streamlining these fees for creators and patrons ensures that creators take home as much of their earnings as possible.

They posted the following graphic to explain the change:

Patreon says the reason for the service fee is to cover variable financial transaction fees that were previously taken out of a creator's monthly payment. Patreon takes 5% off the top of all payments to creators, and the transaction fees were previously also deducted, but now the fees will be charged to patrons instead using a flat rate of 2.9% plus $.35.

What affect this will have on Patreons is unknown. Creators could see more money, assuming patrons don't adjust or remove their pledges. For some patreons, where many users pledge a low monthly amount like one dollar, the charges could amount to an almost 40% increase to patrons (38 cents added to a $1 pledge).

Additionally, Patreon is switching to an "anniversary" payment system, where payments will be charged at the time a user pledges and every month on the anniversary of that pledge. Some creators and patrons have complained that this causes more fees because patrons' credit cards are charge multiple times throughout the month, once for each pledge, rather than all at once at the beginning of the month.

Whatever ends up happening, the change has rankled users of the site.A quick glance through a search of "patreon fees" on Twitter shows almost universal disdain for the changes, with a little bit of "wait and see." After reading through hundreds of recent tweets, we couldn't find a single one defending the change. In addition to the blog post, Patreon posted a Q&A to help users understand the changes, and still later had to update the blog post with an additional explanation of the fees. You can read all of the details here.

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