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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."
It looks like it is time to look for alternate online auction houses.
Viral software licensing is not freedom, it is in fact GNU/Socialism.
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.
I refuse to use Paypal because I am not convinced it is covered by banking regulations. These may not be perfect (understatement of year to date) but are surely better than nothing. Can anybody explain to me in what way entrusting funds to Paypal offers any real and accessible legal protection against fraud?
From scarped cliff or quarried stone she cries "A thousand types are gone, I care for nothing, no not one."
From a sellers perspective I can see the desire to take other forms of payment, but as a buyer there is massive appeal for the use of PayPal. With how its integrated into eBay it makes conflict resolution much simpler and gives you a means of tracking and proving receipt of funds.
The only thing I would want to see added to the service is an escrow option. But the idea of sending a wire transfer, check or money order to some unknown entity on the internet sounds like a bad idea.
"Have you ever thought about just turning off the TV, sitting down with your kids, and hitting them?"
Ebay's success comes because it's a moderator - a broker in a sale. It connects two parties together, and nothing more. When it does that, Ebay is golden. It's UI is nice, it's search feature generally works, and that's why it's a multi-billion dollar corp.
But if they cram paypal down my throat, I'll swallow something else. I'm already at the point where Ebay is my LAST resort, since their ratings have been so thoroughly gamed I have no idea who I'm really dealing with, anymore.
Forcing paypal? No way. I refuse. What's the next halfway decent auction house? Truthfully, I've already moved much of my online purchasing to froogle.com....
I have no problem with your religion until you decide it's reason to deprive others of the truth.
That's fucked up. So now, not only do I have to pay eBay a fee for listing my item, I also have to pay PayPal a fee to get my money? No thanks.
Firstly, although PayPal may have a banking license in switzerland, it is not a bank per se and the Australian Reserve Bank will not guarantee my money with paypal if any.
Secondly, As a bank i have recourse to my money when i demand it. Period.
With paypal i have to jump through many of their fraud hoops which assumes, as a recepient, am guilty of money laundering unless i prove myself to be innocent. That is not how a bank operates. And if a bank will not pay a lawfully presented demand for payment, i can force the bank into liquidation single-handedly. (Long before that the Reserve bank will intervene, but that is beside the point).
Thirdly, PayPal does not follow banking laws in opening accounts with it. Not even in fact the [in]famous SNOW accounts of Citi in early 1980s in US (Negotiated Order of Withdrawal).
Fourthly, if PayPal goes under, who will repay my money with them.
I think the ARb should intervene and either force Paypal to be a "bank" (which is unprofitable for them), or close down.
"Doing what i can, with what i have." ~ Burt Gummer
I already canceled my account since they were forcing me to provide PayPal as a payment option. I really don't understand this. There are SO many people that just don't trust PayPal, So MANY horror stories that PayPal has a stigma against it. Even people that have PayPal now and have never been burned complain that PayPal in addition to the eBay fees cuts into their profits margins too much.
I will never create a PayPal account to take money from people. I just won't do it. So now I cannot sell anything on eBay anymore. Well if eBay can survive just from the Power Sellers, then that is what will happen, but it won't be a place for the average joe to sell his stuff.
I must also say that since eBay burned me and pissed me off, I have not even searched eBay for any products in over a month. I use to check pricegrabber.com, pricewatch.com, cdw.com, and a few other sites in addition to eBay. I don't even check eBay at all now.
Good Luck eBay, your going to need it.
I have a bother that worked for eBay from the beginning. He loved it until they bought PaPal and credits the move with his eventual leaving eBay.
What do you think would have happened if it had been purchased with a stolen credit card, check book, etc? Same thing. PayPal is not acting any different then any other group in that position, in fact the have a legal responsibility to do what they do. Ownership of stolen funds or goods does not change when they change hands for a second time. Pawn shops get burned in this manor a lot.
"Have you ever thought about just turning off the TV, sitting down with your kids, and hitting them?"
If successful, eBay will roll it out to other markets.
If they roll it out in the EU, this could fall foul of competition laws; the credit card companies/banks could presumably complain of being shut out, given Ebay's near total dominance.
(Obvious the same could apply in other countries, but the EU currently seems keenest on actually enforcing competition laws.)
So, let's build a list of alternatives.
If its mandatory, make it free (for use on payment for ebay items, charging for other uses is OK). How can they justify a double charge?
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
I've already emailed a complaint through their contact system. I've had many happy transactions trough bank transfer from both a buyer and seller perspective. This is the ENTIRE reason for the rating system - so you know who you are dealing with before the transaction. I will cancel my account tomorrow and simply buy new over the internet. With the overshopping that goes on on ebay, I'll probably even save some money and get new stuff rather than second hand. Ebay is going the way of Microsoft, way way down under.
consider coffee a lubricant that helps one penetrate the coding zone
"If successful, eBay will roll it out to other markets." Of course they'll be successful, all other modes of payment are barred!
Taking a slight tangent, but I think this is a prime example of one the web 1.0 heroes turning evil. The original management have ceased running the show and we have new management wanting to eke out every dime possible using strong-arm tactics like this one.
Contrast this with Amazon, Google & Yahoo whose operating ethos is still relatviely benign (especially when compared to Microsoft or Apple). Getting to my point... I think Google at the moment is not evil, but you can bet your bottom dollar when Larry & Sergey leave the stage, Google will turn evil, just like Ebay.
I'll see your hokum and raise you a boondoggle.
Not exactly. When a credit card holder disputes a debit, the bank contacts the merchant first and asks him to verify the debit he made. It also gives the merchant details about who disputed what, etc, plus a specific time.
Within the time, if the merchant cannot produce proof, the cardholder's complaint is sustained.
At NO time has the bank the legal authority to debit or even block access to the funds in merchant's account.
This is different from paypal, which is under no obligation to contact you, can and will block your account, and withdraw funds from it without due process.
And that is why paypal is different from a bank.
"Doing what i can, with what i have." ~ Burt Gummer
In the UK (3x as many people as Australia) I got an email to say that Paypal *must* be offered as a payment option, not that it must be the only payment option. So I imagine they are testing different policies in different smaller markets. It makes sense to try to streamline it and get a few more % of each sale - eBay is still complicated compared to Amazon's sales process and Amazon seem to get away with taking almost 10%.
Matthew @ Bytemark Hosting
blam! the sound of eBay shooting itself in the foot.
.au that they will not dare make the same change to .com .co.uk etc.
as a buyer paypal has some good points - limited protection, traceability, etc.
but as a seller it sucks big time as just adds another set of fees to your sale.
eBay nicks nearly 5-10% of the sale price including paypal.
if they made paypal free and just part of the eBay service then there might not be so many arguments, but to enforce it and then make additional money is such a blatent money grab that this will backfire big time.
buyers may like it, but if there are no sellers then there will be no buyers. it will be interested to watch how the number of items for sale changes in ebay.au after this is enforced. anybody know how we can plot a graph of items for sale vs. date to track the impact?
I'm guessing that there will be such a negative impact in
from eBays point of view they are being pressurized to add more traceability into their system by law enforcement worried about fraud and fencing - so they are really between a rock and a hard place here.
one thing is certain - behind every internet giant is a number if "would bes" who will seize every opportunity to steal business, so eBay will have to tread carefully here.
Doesn't eBay -own- PayPal...?!?
Well, forcing your customers to use your subsidiary company (or any supplier, for that matter) sounds pretty anti-competitive to me... and - if the Aussie comtetition watchdog barks loudly enough, eBay may have to play fair again.
I'm sure credit card vendors will scream "Fowl!" soon...
I hope they will do this, and then realise thats its a big mistake when customers go elsewhere. Its a great opportunity for a competitor to steal some of their market.
I understood that by law, merchants are required to accept legal tender to pay a debt. In other words, there's no way they can prohibit people paying cash once a debt exists (i.e. they have one the auction).
Admittedly the above is from my recall of High School business studies, and IANALADHAT (I am not a lawyer and damned happy about that).
Do you or your partner snore? - Visit www.snoring.com.au
eBay Poland is still dead.
After introducing fees for their auctions, they dropped from their 3rd place with a good chance to become 2nd to being somewhere along with the two last places - auction sites that are subject-specific, collector auctions. Very few desperate sellers use it, and over 90% offers 'from Poland' are listed as 'e-book, electronic delivery only, free shipping world-wide', foreign auctions.
45 5F E1 04 22 CA 29 C4 93 3F 95 05 2B 79 2A B2
Ebay is pretty much THE auction site on the net, and they own paypal. this sounds like leveraging a monopoly in one market to effect an advantage in an unrelated market and anti-competitive behaviour to me.
the EU has given microsoft plenty of shit over the years for anti-competitive behaviour, it will be interesting to see if/what kind of flack ebay attracts over this.
I use eBay occasionally but my email address and bank details are barred from PayPal, so if this happens I won't be able to use eBay at all.
I'm barred because I (as a seller) was scammed and left £300 out of pocket - when I tried to complain to PayPal, I couldn't even get through to a human being, and they automatically assumed that I was the fraudster, and shut down my account. Ironically, they were slower at shutting down the scammer's account on both eBay and PayPal, despite my attempted warnings, and they went on to scam a few other people before they were finally barred.
By the way, is there a decent alternative to eBay, or have they got a complete monopoly?
How is this NOT a violation of the trade practices act?
Anyone know the right way to get the ACCC to investigate this?
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.
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....
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.
It seems that with this, and the Amazon news from a few days ago, some of the companies that experienced rapid growth during the first .com bubble by offering what the customer wants vs the old model of trying to control the market are now switching to the old model. They control enough of the market now that it probably seems safe to their board to do this, but they are forgetting how rapidly they themselves were able to grab market share, and seem to be missing the fact that if someone new moves into the space they are vacating, the market share that the new company takes will come almost entirely from their customer base. They should also keep in mind that it won't necessarily be a startup that moves into their space; Google, Yahoo and Microsoft are all contenders that could jump in and cause a massive shift in the market almost immediately.
If some of you will recall, ebay doesn't allow you to use paypal for the Mature Audiences section. Does this mean they are planning to get rid of adult items?
I have always used postal orders, made out to CASH, when paying for goods bought from eBay. I feel this is the safest form of payment because of all the gaps in the trail. The seller doesn't need to know any more about me than where to send the goods, and I only need to know where to send the money. The clerk at the post office where I bought the postal order doesn't know where I am going to send it, and once the PO is in the post, there is nothing to link it back to me. The clerk at the post office where the seller cashes the PO doesn't know where it came from; and once the goods are in the post, there is nothing to link them with the seller. If any unauthorised party intercepts either transaction, the recipient can reasonably say they know nothing about it. After all, I have no control over some stranger who decides to put something in an envelope and write my address on it! Sometimes, that level of plausible deniability is very important.
.....
If they start insisting on PayPal, I will cease using eBay. I do not want my transactions monitored so closely, thank you very much. Part of me is even surprised that eBay have not started a delivery company {or bought up an existing one} and started trying to strong-arm people into using that
Je fume. Tu fumes. Nous fûmes!
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....?
A month ago I got an email from Paypal to update my credit card details as my card went out of date.
I proceeded to update the details, when I was informed that people can pay me with paypal, but I couldn't withdraw any funds unless I fax them 2 forms of identity.
I immediately baulked at this. They are asking for details reserved for Banks etc when they are not a bank. In fact they are a private escrow company without complying with anything.
But my problem is that I do commission sales for people who have no idea how to sell on-line. Big, single items worth hundreds or thousands. So now I have to prove my identity with these documents, just to be able to draw money out of the account.
The whole thing sucks and I'm definitely going to say "PayPal NOT preferred" from now on.
Don't be apathetic. Procrastinate!
One big concern I have with Craigslist is, eBay apparently invested heavily in them already. I used to wonder why they'd possibly see any benefit to dumping a bunch of money into what's essentially a free version of newspaper classifieds. (I mean, Craigslist has pretty much NO mechanism to collect money, and no rating or "feedback" functionality on the site, seemingly making it useless to something like the eBay business model.)
But now I'm wondering if this was a "plan B" for them all along? If eBay goes "sour", they could leverage Craigslist as an alternative? They probably bet, all along, that most of the people who'd defect from eBay over issues like "mandatory PayPal usage" would wind up on Craigslist. They could institute policies of charging monthly subscription fees to post on Craigslist or something - and keep on taking money, even from the people who thought they were dodging them.