In an email sent this morning, PayPal says:
Thanks for using PayPal and the PayPal Money Market Fund. Unfortunately, we’ve decided to close the Money Market Fund, effective 7/29/11.
What does this mean for you? PayPal will transfer any undisbursed dividends you’ve earned into your PayPal account within 7 business days after we close the fund. Don’t worry; you don’t have to do a thing.
Your 2011 tax documents will continue to be available on the Fund Summary page in your PayPal account throughout 2012. You’ll receive a tax statement from PayPal only if you’ve earned $10 or more in dividends in 2011.
Thanks for your understanding,
PayPal
The PayPal Money Market has been earning a pathetic interest lately but for years it was earning more then many of my real offline savings accounts. Even when it was only earning a small amount, it was nice to earn something on the money that sits in your account. It was another small way it offset the fees. Now there’s no reason not to pull money out of there as soon as you’re done with it. I can’t help but wonder how that will hurt PayPal in the long run if more people no longer carry a balance.
Were you a part of the PayPal Money Market? Will you miss it?
What do you think this means for PayPal in the long run? Does it signal a fee increase?
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I initially put a few thousand into paypal simply because it was earning close to 5% interest. Even though that was a dismal .2% lately, it was better than nothing.
I believe it will hurt them, though I don’t know how many people use Paypal (Ebay) purely for transactional ease. I find credit cards are just as easy now, and even safer with the feature that allows a 1-time temp account to be created for single purchases.
Personally, I withdrew my entire account balance from PayPal today. Why leave dead money in there?