If parcel carriers changing payment terms and late fees sounds familiar, it should. Just last year, FedEx and UPS unleashed a wave of changes to payment terms and now the uncertain parcel pricing landscape is shifting again, this time with UPS releasing another batch of changes set to take effect March 31, 2025.
- Late payment fee rises to nearly 10%: The late payment fee will rise from 8% to 9.9% of the total past due invoice balance, including past-due late fees that have already accumulated. Just three years ago, the late payment fee was 6%. Not only that, note that UPS payment terms are just seven days, and that includes weekends – not just business days – requiring shippers to stay vigilant and act quickly to avoid late charges.
- New check and wire fee: A $25 fee per payment will be assessed to all payments made by check or wire transfer. This fee will not apply to ACH payments.
- New print invoice fee: UPS will charge a $5 fee for each printed invoice copy sent to shippers or other payers.
But while the changes above represent the most urgent new threats to shippers’ budgets, another extremely consequential change looms on the horizon, effective May 18, 2025:
- New payment processing fee: The good news for shippers is that the credit card surcharge is no more. The bad news is that a payment processing fee equal to 2% of certain invoice charges will be added to each invoice. We’ll keep a close eye on this one.
These changes represent the latest in a steady stream of subtle-yet-meaningful pricing changes introduced by parcel carriers in recent years, designed to inflate shipping costs for the same level of service. With carriers committed to constantly changing an incredibly complex web of rates, pricing and payment rules, shippers need an expert advocate to keep track of these changes and understand their impact.
To bring clarity to your parcel pricing picture and to start tailoring a plan to take control of your shipping costs, reach out to the AFS parcel experts.
