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eBay Australia Makes PayPal Mandatory
An anonymous reader writes "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."
Well, I guess its definitely time to look for an alternative, and pull my highly rated account from ebay :(
I refuse to use paypal due to having bad experiences with it in the past.
In Australia i'd say paypal for paying for ebay auctions is hardly use AT ALL since in Australia its far easier and quicker and cheaper to pay using direct deposit with netbanking. That is THE standard pay to pay here. Why use a middle man? And now to be FORCED to use one? I don't think so.
You can tell how powerful someone is by the magnitude of the crime they can commit and be able to get away with.
Nope. If it were a bank, the merchant would pay for the loss or the bank will bear it.
As banking laws go, once the money is in your account, nobody (except by court order) can debit your account except you.
Nobody.
Similarly, they can't suddenly block access to your account without informing you in writing.
PayPal OTOH can debit your account and drain it fully and then refuse to explain why plus put you in call waiting.
"Doing what i can, with what i have." ~ Burt Gummer
When Paypal europe moved to Luxembourg last year, due to EU regulations it had to become subject to banking rules. More information here: http://www.finextra.com/fullstory.asp?id=16927 I don't think it's a bank outside europe though.
I have found some good reviews of the following, and they all look cheaper than ebay.
http://www.specialistauctions.com/
http://www.52marketplace.com/
http://www.cqout.com/
http://www.ebid.net/
http://www.tazbar.com/
http://www.oneway-uk.com/
http://www.avabid.com/
I have only had a quick look at each, http://www.ebid.net/ seems to have the most comprehensive items list from a buyer's point of view
Funnily enough, I thought the Australian government was also pretty serious about anti-competition laws.
I'm hoping for (not necessarily expecting) a massive smackdown by the ACCC.
Correct, from 21st May Paypal must be one of the payment methods. But, and I quote the email sent by eBay, "From 17 June you will only be able to offer PayPal on your listings and pay on pick up (i.e.paid for when picking up the item)." This, by omission, excludes direct bank deposit, cheque and money order, all of which are popular and very much cheaper than Paypal.
http://www.accc.gov.au/content/index.phtml?itemId=815327&Go.x=9&Go.y=6 I suggest every australian does this and complains
Two points:
Paypal Australia Pty Ltd is an Authorised Deposit Taking Institution (the umbrella term covering banks, credit unions and building societies) according to APRA:
http://www.apra.gov.au/ADI/ADIList.cfm#PB
There is no explicit guarantee (by the RBA or anyone else) on deposits held with banks or other ADIs in Australia, although it is often assumed that if one of the banks went bust, the government would bail them out.
i simply can't be ass'd doing it again, easier to just use gray's online or something.
If you mod me down, I will become more powerful than you can imagine....
Thats exactly what it is. eBay owns Paypal. Right now they're looking for more money (hence the change in seller fees). By also forcing you to use PayPal they can take an even higher return on the items you sell.
Between eBay's listing and final value fees and Paypal's fee, eBay has to be taking 10-20% of the final value of your item. To compound that even more, both the final value fee and Paypal's percentage are based off the final value of the item.
For buyers its iffy (depending on how you feel about PayPal). For sellers its horrible because you're getting screwed both ways!
Not true in the US.
:(
Here's a US Treasury Dept. link from a comment I recently modded Informative:
http://www.ustreas.gov/education/faq/currency/legal-tender.shtml
I cannot find the comment now, Slashdot's search function is too under-powered
As I discovered to my cost recently, if you accept PayPal payment you are effectively also accepting Credit Card payments (via PayPal). Unless your sale qualifies for seller protection (mine arbitrarily didn't, and unless you check it's not easy to realise you're not covered), then you are totally open to something called 'chargeback'.
Chargeback is basically fraud protection - if someone's credit card is stolen they can recover any lost money. But where do you think this money comes from ? From the credit card issuing company ? From PayPal ? Nope - the fraudulent transactions are reversed, so the person who originally received payment ends up footing the loss. That's maybe all well and good when you are talking about large companies and small levels of fraud, but now with eBay we are talking about literally millions of small time sellers, and probably hundreds of thousands of fraudulent transactions.
What this means is that if you accept PayPal payment, unless you are very careful about being 'protected' (and even then, who knows how far that protection covers you) you will be totally liable for any credit card fraud that transpires when someone purchases from you. The chargeback can (and does) occur MONTHS after the original transaction.
I strongly advise everyone NOT to accept PayPal payments at all. If eBay is forcing PayPal onto sellers, then I recommend ditching eBay - the risk of fraud is too big. You might as well leave your items on the street with an honesty box.
my god you people miss the mark by a long shot. the merchant is the CC company providing the funds.
... but the *merchant* is ALWAYS you.
No. Sorry. You are the one way off the mark.
As someone who has owned a business I can assure you, the merchant is the *business owner*. The other party is typically called a "bank", "merchant bank", "merchant account provider", "acquiring bank", or "acquirer"
Now, from the "merchant account providers" point of view...
"In the Visa and Mastercard rules, the merchant's processing bank [merchant account provider] is 100% responsible for all the transactions that the merchant performs. This can leave the provider open to millions of dollars of potential losses if the merchant operates in an illegal or risky manner and generates many chargebacks. The providers pass this cost on to the merchant, but if the merchant is fraudulent or simply does not have the money, the provider must pay all the costs to make the card holder whole."
Which is probably what you are talking about. So, Yes, its absolutely true that THEY (the merchant account providers) are liable for any fraudulent charges, and THEY must cover it. If you, as a cardholder phone Visa and ask who pays if your card is stolen, they'll just tell you 'not you'. If you persist they'll tell you that (according to PCI DSS [Payment Card Industry Data Security Standard]) the cost is borne by the bank providing the merchant account ["merchant account provider"].
However, as it says in the above quote, while they are responsible, they *invariably* try to recoup that cost, plus fees, plus fines, from the merchant (that would be YOU). They only get stuck holding the bag and taking a loss, if they CAN'T get the money from you...and that only happens if you're insolvent, or you've fled the country, or something equally drastic. If you are an upstanding reputable business in good standing, they WILL pass that cost on to you, and you WILL pay.
So as far as your card issuer or VISA is concerned yes, the liability rests with the merchant account provider. But you're daft if you don't think they in turn pass that liability to you via your 'merchant account' agreement/contract, and collect on it vigorously.
Look it up.
I would strongly urge all OZ Ebayers to lodge a complaint online to the ACCC. I wouldn't be so worried if Paypal/Ebay didn't have carte-blanche to my accounts. But when they create a monoply like this and also increase the costs at the same time, while reducing the risk of financial security i think they really need to be taken to task and regulated just like any other financial institution's.
Lodge a complaint at (general complaints form):
http://www.accc.gov.au/content/index.phtml?itemId=54217
This is what i (very hurriedly) wrote to give some an idea of what to lodge if they want to complain but aren't sure what to write:
Ebay as of 17th June 2008 is removing all forms of payment from being allowed in almost all auctions and is forcing all sellers (and buyers) to instead use their Paypal online debit/credit system. This not only creates a banking and auction house monopoly for Paypal, and by extension Ebay, it also greatly increases the costs to all sellers who then are forced to partially subsidize the payments from buyers in the new multiple fees introduced. More worryingly though is the fact that while all other forms of payment, including direct bank deposit, arguably the most popular form of fast and fee-free payment system used in Australia, will not be allowed, Paypal is not a regulated bank, and as such we are literally at the mercy of Ebay/Paypal with absolutely no guarantees of security for our accounts.
While Paypal and Ebay insist this is done to increase the safety of payments made for items purchased, there exists a long history of abuse from Paypal with regards to account freezes with no reasons provided, numerous cases of buyer fraud where items have been force ably and automatically refunded by Paypal to customers routinely claiming non-receipt of goods, debits for non-existent fees, etc. There is also virtually no form of arbitration when these events occur, with Paypal arbitrarily enforcing their will onto the consumers/sellers. Paypal also has the ability to withdraw funds from accounts and credit cards on a whim at any time, with no protection whatsoever to the consumer.
http://www.infoworld.com/article/07/05/15/paypal-granted-europe-banking-license_1.html The new license notwithstanding, PayPal has no plans to offer traditional banking services in Europe, but intends to simply take advantage of its new status to become more aggressive in its direct sales operations, she [PayPal spokeswoman] said.
http://gunbroker.com/ - eBay doesn't let you sell weapons
because we all know how great paypal is, and how often that they want to talk with you in case of problems, most people can't even find their contact phone number, let alone get someone worth while on the phone who knows what they are doing....
My experience and friends experience with them, makes this one of those things that saddens me.
If they could up their regulations and communications with their clients, then maybe but they do everything to avoid talking with you about the problems you may be having. NEVER KEEP LARGE AMOUNTS OF MONEY IN YOUR ACCOUNTS, THEY CAN FREEZE IT AT THEIR DISCRETION AT ANY TIME WITHOUT NOTICE.
My friends sells batteries, as a powerseller, and whenever he has problems with credit cards, he can usually get info from the card company, even if he has to swallow the charge, however if there is an indiscretion with someone else's paypal used to purchase his item, he gets frozen until they can figure out what happened, and they are very slow, almost retarded...so he waits and waits, he has a few accounts set up in case of such thing, that way he can still do business..
but what a hassle, it isn't his fault someone frauded someone else's account, so why does he pay
in lost revenue etc....?