All good things do come to an end. This is also the case with Paypal’s Merchant Referral Bonus Program which the payment processor recently announced will be discontinued effective August 15, 2012.
Paypal’s announcement about the end of the bonus scheme is as follows:
Thank you for your participation in PayPal’s Merchant Referral Bonus Program. The program will be discontinued on August 15, 2012.
Effective on August 15, 2012:
- New referrals will no longer be tracked
- Bonus accrual payments will be stopped
Your PayPal account will not in any way be impacted by the discontinuation of this program.
Any final accrued bonus balance from your referrals through August 15, 2012 will be paid to your PayPal account in accordance with the standard 30 day payout cycle.
All links you have created will still work and will redirect to a PayPal sign up page. However, referrals will not be tracked or accumulate toward this bonus program.
For most online money-makers, the discontinuation of the affiliate program might not be considered big news because Paypal’s referral bonus scheme was not as lucrative as, say, Google Adsense or other affiliate marketing programs. But the turnaround signals a major shift in the evolution of Paypal.
The move might either mean Paypal is cutting down costs so as to bolster profits or it is removing incentives because there is no further need for referrers to bring in new users.
We believe both reasons are valid and also intertwined. Paypal’s previous competitors such as Yahoo! PayDirect and Western Union’s BidPay have already exited the market. Current players like Google Checkout, Amazon Payments, Moneybookers, and WebMoney, among others, are struggling until now to make a dent in the industry.
Recently web application tool company New Relic has said Paypal is the leading online payments processor, with 60% market share. With such dominant position and no emerging major competition, Paypal does not need help in recruiting new users, hence the discontinuation of the referral bonus program. With extra costs cut down, Paypal can ensure eBay, its parent company, that business growth and profitability are sustainable.
We have been a Paypal user for almost a decade now. And in the past years, Paypal’s Merchant Referral Bonus Program has given us regular, although not so significant, referral commissions for helping them get new users.
As the Merchant Referral Bonus Program comes to an end, we thank Paypal for the experience making money with them and we reminisce such good times by revisiting the following articles we wrote in the past: