Thursday, April 10, 2008

eBay Trying Out PayPal ONLY Payments In Australia

As reported on SlashDot:

"Australian press are reporting that eBay is using Australia as a guinea pig to trial a new policy where all other modes of payment are barred except for PayPal. If successful, eBay will roll it out to other markets."

---------- FIX YOUR THINKING COMMENTARY ----------

This is a hard judgement call for me. I have almost 99% of my payments processed through Paypal. It's actually a burden for people to send me a check or money order. However, when I sell a large item - I'd rather have the cash, or a certified check mailed overnight because of PayPal's lack of seller protection.

I've had a lot of Australian eBay purchasers over the last 6 months.


Anonymous said...

If businesses can stipulate "cash only" because it is better for them and are willing to put up with the percentage of customers that will object, then it follows that there is no reason why eBay cannot do the same with "PayPal" only. In "eBay World" PayPal is the currency of choice and using this system will have the further benefit of keeping people that are not serious about eBay out of the mix.

eBay has developed PayPal into a popular currency standard, so there shouldn't be any protestations due to them owning PayPal as well. Buying or selling on eBay is a privelege that is subject to rules like anything else, and this rule isn't unreasonable.

Paul Douglas said...

As a 100% Certified PayPal hater, that would be the final nail in the coffin for eBay from my point of view. Even now, I'm not especially keen on using eBay. But It's not out of the question. Using PayPal is though. If they make this move, I will never use eBay. Amazon Marketplace suits me better anyway.

Anonymous said...

I call BS. There is no way eBay could actually get away with this. Perhaps as far as collecting seller fees they could, but they could never force other eBay businesses to accept PayPal only. It would create anti-trust issues I believe because it eliminates competition in the payment aspect of the system. I think it would also cause businesses, say such as auto dealers who take advantage of eBay to move their business elsewhere. I've done purchases on eBay where I wanted to inspect the item before paying and sellers do allow that if you're local. How would that work? I meet the guy, inspect it, want to buy it, then what? Go home pay via PayPal and wait for it to be shipped or arrange another meeting?

Sometimes when I sell large ticket items on eBay I don't accept PayPal but only my own merchant account or money orders. This is so that I can control things like potential chargebacks as well as I get a much lower rate on my merchant account than PayPal's 2.9% (ok 2.3% may not be "much" lower but when you're selling a $5,000 item it's $30.)

Personally I hate PayPal, not that I'm fond of eBay either but... By eBay becoming both the facilitator of the transaction and the payment processor they would in essence become a sort of consignment shop. I believe they'd have the liability for things like collecting sales tax, recalls, fraud, maybe even returns. Right now eBay can be very hands off.

And in dealing with Visa and Mastercard I'm sure they'd never allow it. Not that they'd want to hurt their relationship with PayPal too much, but I can imagine they would jack-up PayPal's rates when eBay/PayPal decides to eliminate them as competition for accepting payments.

Should eBay decide that only PayPal were accepted I would never use them to buy or sell again, and I'm sure I'm not the only person who feels that way.

FYT said...

Paypal is a clearing house for checks credit cards and paypal balances ... there is no monthly terminal or batch out fee ... there is no reversed transaction fee. ALL other online payment systems than googlepay are for the most part are scams or not in wide use. I COULD easily use a merchant account ... but to me as a seller PayPal is a magnitude more efficient and easy - even if they are a percent higher.

Anonymous said...

I don't think you have much experience with merchant accounts to be honest. The figures you've stated previously are way out of whack with reality.

Maybe for the scam ones you're right. This isn't who I use, and I do pay a little more (like I said 2.3%):

But take a look. Merchant accounts are cheap, and Nova is a well known reputable company. Getting setup is extremely easy. These fees you talk about like terminal fees are $5 to $20 a month. And "batch out" fees you like to quote are 5 cents per day where you have a batch.

You might want to do some research before writing off a real merchant account and swearing by PayPal.

PayPal does rip you off. They charge you for check based and balanced based transactions where a merchant won't.

PayPal's policies are not only more strict but are unilateral. Ever tried to dispute a chargeback with PayPal (I mean an actual chargeback, not PayPal's silly dispute thing)? You can't win. The way PayPal sees it, they get the money from you either way, so why fight the credit card company on your behalf? No gain for them so it becomes your loss.

Unlike merchant accounts, PayPal is not a bank. They are not covered by federal regulations and can do zany things like withdraw money from you when they feel they're in the right. Your dispute process is with them, not a bank, and unregulated. PayPal becomes judge, jury and executioner.

Once PayPal wrongs you and you see how asinine they are to deal with you'll change your tune. What's kind of funny is how you like iTunes 30% cut because selling things yourself is so damned difficult, yet you praise how easy and cheap PayPal is. Why aren't you demanding that iTunes charges what PayPal charges or is it that you just prefer certain companies and being ripped off doesn't bother you as long as it's by a company you like?

But the topic was eBay... why would a seller choose a system where they are so completely controlled and indebted to a third-party who has no interest in their business other than to syphon off a percentage?

eBay becomes an auction house and should start acting like one. They should charge the buyer after the hammer price not the seller. Or they should become a swap meet and charge the seller an entrance fee but leave the rest of the transaction between the buyer and seller.

Ahh, but now I get it. eBay is the iTunes app store. They should get it over with and let people list whatever crap they want and take a flat 30% cut when something is sold.

No wonder you like eBay and PayPal so much!

FYT said...

Actually ... I have a lot of experience with merchant accounts as I used to have one and helped set up a previous business with one where I worked. I also REGULARLY help my clients set up merchant accounts as most are "arts and crafts" people that need to sell their stuff at events.

ALL of my checks for EVERY check written to me must go through veriCHECK - which will insure any purchase up to $500 and warn me of recent bounced checks. That costs a dollar - so a $10 transaction could be as high as 10%