Have you used a payment method other than PayPal to make purchases online since 2019? You may have been subjected to PayPal’s allegedly anticompetitive fees. Fill out the form to find out your rights to potential compensation »

Case Status
U.S. District Court for the Northern District of California
Case Number
PayPal Holdings, Inc.
PayPal, Inc.
File Date


According to an independent investigation by Hagens Berman’s consumer rights attorneys, PayPal has allegedly subjected consumers to excess charges when purchasing from merchants that accept PayPal or Venmo. The law firm’s class-action lawsuit states that PayPal’s merchant agreements, which all merchants must sign to accept the payment supplier, raise consumer prices.  All consumers using non-PayPal methods of payment (credit cards or non-PayPal digital wallets) may have a claim and right to reimbursement.  The complaint asserts that if PayPal’s agreements were transparent, consumers would quickly see a price difference between PayPal and Venmo and its competitors.


If you made a payment to a retailer that accepts PayPal or Venmo, that merchant was bound by PayPal’s agreements, meaning you paid an allegedly excess price. Fill out the form to find out your rights.


PayPal charges an industry-high fee for its transactions and PayPal’s allegedly excessive fees are enforced through its merchant agreement and anti-steering rules. These rules dictate that if a retailer accepts PayPal or Venmo payments, they cannot offer any discounts or inducements to persuade consumers to use other payment options that have a lower cost (like credit cards, digital wallets, etc.). PayPal’s anti-steering rules do not allow discounts on non-PayPal transactions and PayPal’s industry high fees are baked into the prices consumers pay when they purchase goods online.  

Merchants also cannot tell customers that other payment methods are more cost-effective or preferred, according to the complaint. Merchants are even barred from presenting other forms of payment earlier in the checkout process.

These rules allegedly serve only to stifle PayPal’s competitors, inflating the prices consumers would otherwise pay.

According to the complaint, without PayPal’s anti-steering rules, the difference between PayPal and Venmo compared to competing payment options would be clear: Facing PayPal’s industry-high fees, a merchant could charge $5.83 for a box of Kleenex when PayPal is used as the payment method, and less than $5.83 when the consumer paid with credit card or other payment. Or, a merchant could maintain the same $5.83 sticker price but provide consumers with a discount when they paid with a method other than PayPal or Venmo.


  • Over 400 million: Number of consumers who have PayPal accounts
  • 41 million: Number of daily transactions processed via PayPal
  • $27 billion: PayPal’s generated total revenues in 2022, most of it coming from transaction fees
  • $1000: The annual amount that the average family pays in payment processing fees, estimated by the Merchants Payments Coalition
  • 22 billion: Number of transactions PayPal processed in 2022
  • $1.36 trillion: Transaction volume of PayPal’s 2022 processed payments
  • Nearly 1 million: Number of U.S. eCommerce websites that accept PayPal as a means of payment


Hagens Berman’s lawsuit brings claims of violation of federal and state antitrust laws, as well as state consumer-protection laws on behalf of consumers. The class action seeks repayment to those who paid allegedly excessive fees due to PayPal’s anti-steering rules, as well as a request to the court to put an end to PayPal’s policies and merchant agreements that enforce these rates.


Through a class-action lawsuit, individual consumers can collectively bring claims against large corporations that would otherwise have the upper hand, like PayPal. A class-action lawsuit seeks to level the playing field, bringing strength to collective action to change corrupt practices and negligent responses to customers. Though these measures do not bring immediate relief, they are a time-tested method of holding companies accountable for wrongdoing, including a company’s anticompetitive practices involving excessive fees.


Hagens Berman is one of the most successful consumer protection law firms in the U.S. and has achieved more than $320 billion in settlements against some of the nation's most powerful corporations and institutions. Hagens Berman is currently pursuing point-of-sale related litigation against Apple Inc. regarding its Apple Pay payment system and excess fees foisted onto card issuers under its policies, as well as additional cases against credit card issuers for allegedly excessive fees. Your claim will be handled by attorneys well-practiced in this complex area of consumer law.


In no case will any class member ever be asked to pay any out-of-pocket sum. In the event Hagens Berman or any other firm obtains a settlement that provides benefits to class members, the court will decide a reasonable fee to be awarded to the class' legal team.


Complaint Filed

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