Friday, August 29, 2008

ProPay vs PayPal

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Yesterday I got what I consider a spam comment from Brandon at ProPay. According to my posted spam policy I have deleted and reposted the comment, minus link. For future reference Brandon, hiding your Blogger profile and failing to leave contact information gives you and ProPay serious credibility problems with me.

ProPay as you may know is the beard (One who serves to divert suspicion or attention from another - American Heritage Dictionary) eBay suits have donned in hopes of avoiding lawsuits or deflecting charges of violating the Sherman Antitrust Act, Sec.5 of the Federal Trade Commission Act, and Sec.7 of the Clayton Act which regulates exclusive dealing contracts, tying agreements, or requirement contracts.

Brandon wants you to know

"Right now we only offer a merchant account but at the end of September we will be announcing a new special account for our eBay customers. ProPay will charge a small yearly fee, but will provide several services and we will help our customers fight against fraud."


Isn't that nice?

I am sure that eBay has non standard merchant processing requirements for ProPay to fulfill in order to be allowed on eBay. Sellers will be told what ProPay has to offer on eBay right at the start of holiday shopping season. Would I use an untried payment processor at that time of year? In one word, no. Exactly what PayPal wants.

I do not believe at the present time ProPay is competitive with PayPal for smaller sellers. For web stores ProPay expects the seller to manually input the credit card information, this incurs a security burden I would be unwilling to assume. Further it would discourage my buying from any site using ProPay.

According to the ProPay EFT Agreement a merchant agrees;
As part of this agreement, you irrevocably authorize ProPay to debit your Checking Account for any fees, payments or penalties you owe or may owe ProPay relating to ACH or Intra-ProPay transactions. You authorize ProPay to initiate reversal or adjustment entries and initiate or suspend such entries as may be necessary to grant you conditional credit for any entry.


Gosh & WOW! That sounds worse than PayPal!


The company seems confused as to exactly what charges apply to the various levels of service. On this page Premium is shown as having an annual fee of $29.95 with 3.25% + 35c per transaction and processing limits of $500 per transaction and $3000 per month. Earlier this morning Premium was $59.95 per annum and Basic was 34.95.

I was unable to find any reference to international transactions and four telephone calls to the PR department during the course of the business day netted me voicemail. Here is a little quick comparison chart.

Once again eBay is comparing bananas to pineapples, just because they are both yellow they hope you won't notice. Looks more like a lemon to me.

Y'all come back!




Related articles:

Yes we have no bananas!





13 comments:

Kevin_T said...

Ebay/PayPal learned something from their experiences (so far) in Australia. Their defence against being anti-competitive at that stage was that buyers were allowed to use pay-on-pick-up, and thus PayPal was not the only payment option to be proposed. Australia is about the size of the United States of America, and has a fraction of the population (21 million) - bluntly, while pay-on-pick-up may be viable on some individual transactions, it is not a viable overall alternative in the Ebay marketplace. The Australian authorities saw through this, and currently the Reserve Bank of Australia is giving additional attention to PayPal's practises.

None of that even addresses that sellers MUST offer PayPal on pick-up-only items in Australia and the United Kingdom (and I assume most USA sellers will have to after the end of October - but that is not entirely clear yet), and any item that is picked up with a PayPal payment leaves the seller hugely vulnerable to fraudulent chargeback. After twelve months of promising to address this situation the corporate minds at Ebay still haven't provided a workable way of protecting sellers who sell pick up only items, other than motor vehicles - as PayPal does not want to get involved in warranties and other such problems.

Thank you for the comparative chart, Henrietta, it says much. I Personally don't mind Brandon having a right of reply, and it was clear in spite of the blog link, that he was representing Pro-Pay. I would be interested in knowing, after reviewing the chart, whether Pro-Pay will actually be paying Ebay for the right to be used on their site (either as a lump sum/subscription or commission onb payments received), and whether it is a requirement of their agreement that their prices should be higher than those offered by PayPal.

Kevin

city pretties said...

ProPay sounds like it'll be just another BidPay. Disorganized and poorly managed and doomed to be trampled under the giant foot of PayPal.

ECBeauty said...

There must be price fixing involved - there is no explanation why propay wouldn't quickly and radically change its fee structure to capture eBay members.

Just another episode of eBay's felonious activity

Anonymous said...

Actually, ProPay is a good overall solution for merchants wanting to be able to process customers cards by swipe, keyed entry, online, or by phone, they offer more flexibility than PayPal, in that it is somewhat unprofessional for a small business to ask to be paid by PayPal and go through the process of setting up an account for a purchase of anything non-related to eBay or other online auction.

ProPay does include a payment API for integration with a website, and is also good for mass pay.

They also have a payment network, for which we are members. This allows our sales representatives to make sales and instantly get their commisisons funded to their debit cards.

For small business to medium business, ProPay is a better fit for our company that PayPal or our Bank of America merchant service was.

Although, for an ebay transaction, I would NOT send my credit card number unless it was on the ProPay website, no way would i ever send to the online merchant!

Grabby said...

Thank you very much for your research. I found it very useful. I have recently ended a four month dispute with PayPal. (Long story short, a buyer tried to scam me. Although I had proof, PayPal continued to side with the buyer. It was only when I-- in protest-- refused to pay my eBay fees that PayPal finally sided with me and ended the claim.) I have resisted a merchant account up until this point because I didn't want my buyers to have to go through the hassle of off-site checkout procedures.

You can imagine my delight when I saw that eBay would be offering ProPay as an integrated payment solution. I liked the fact that they were backed by real banks. After looking on their Website, I thought their fees were high for what my usage would be. I also know that in the past others have complained about poor customer service.

The changes at eBay and PayPal over the past year have taken me from being on my way to PowerSeller status and a fully-functioning business to wondering why I continue to sell and attempting to re-enter the "normal" workforce. Red Ink Diary, you are truly an asset to the community. I thank you and appreciate the time you take to educate us all!

Sunforged said...

I found your blog entry while researching information about PRopay for basically the exact same article fro my blog

www.sunforged.wordpress.com

I had mentioned in aprevious article about ebay sellers tips and recnt changes that ebay was now "offering a flimsy alternative, Propay"

I also received the same form comment from "Brandon' Senior account executive.

Propay has existed for a while and has tons of negative reports relating to their customer support, for many years it seems they did not offer phone support!

Thank you for your well researched article

Anonymous said...

If what you say is correct, I'm screwed... I'm looking to replace PayPal because. PayPal blatantly didn't review any of the 8 photos or the 7 faxes I sent regarding the tool set I sold someone on EBay. Who claimed to PayPal it broke the 1st time he used it! They gave his $$$ back but no explanation to me as to what they didn't like about my side of the story! I repealed twice. Denied both times. I tried calling PayPal to ask how can I not have a repeat of this if they don't tell me what made them agree with the customer. I have sold hundreds of these sets.
No complaints like this before! They would not comment or help...
So where does that leave me?

Jen Y said...

I have used Propay successfully for over 4 years. It is what the Mary Kay Independent Beauty Consultants use to process credit cards from our individual websites and from our customers. Many consultants fall within the small to medium business model discussed.

I have found it to be efficient, very well organized, and I've never had a problem on either end of transactions.

Just wanted you to hear from a user that has no vested interest.....

Anonymous said...

here is my 2 cent..

this is a quote from propay under their customer service FAQS

"ProPay is a cost-effective alternative to traditional merchant account offerings providing individuals and small businesses the ability to process their customer's Visa, MasterCard®, Discover, and American Express cards.

ProPay also enables easy access to merchant funds through a Prepaid MasterCard Card, or a simple transfer to any checking account. "

Again key word here is ALTERNATIVE!

Pro Pay is not a real merchant account. Real merchant accounts transfer the money straight to your bank account with no charge. Real merchant account never hold your money and offer you some sort of credit card. Real merchant account again never hold your money. Never, because they cant. It is against the law for them to do so because Merchant providers are not financial banking institutes. They are service providers period

My 2 cents , Get Real, Get a real merchant account.. save real money by paying 2% or less per trans

Gary said...

For the life of me, I cannot see how anybody would expect a buyer to submit credit card details for every transaction, as it seems to be the case with Propay.
I understand they have the swipe and other manual facilities, which I am sure serves a good purpose for “real” or “mobile type” retailers.

But this discussion is really about Propay’s overlap with Paypal’s current functionality.
There is currently nothing to beat the system used by Paypal for ONLINE TRANSACTIONS.
Submit you credit card details once (with verification if you are a seller) and never again is the way to go!

But the irony now is that Paypal does not serve all countries in the world (bummer).
Yep, I sit in South Africa and I can purchase goods (send money) but I cannot receive money. Can you believe it?

Try for yourself : I left the Paypal feature on my site so people can see it is not me. Either the government or Paypal for some obscure reason prevents this.
http://truthtraders.com
Now there is a good one, does anybody have a clue as to what the real reason is?

Thanks for a nice forum to vent a bit of frustration!
Oh by the way, I cannot resist to mention to those who are upset with Paypal ---
You don’t appreciate it until you don’t have it.
Paypal is free (well technically not but you don’t feel the money paid so…). Swallow your pride, and resolve your issues [it makes life much easier] until some rich kid / guru comes up with another Paypal…… (Now I am done) Thank you.

Anonymous said...

Here is how you settle a locked account on paypal.
1. Work with them. Give them everything.
2. Wait till they review the info.

3. If they do not complete your review in a timely manner:
a. Call them once a day for 3 days, and ask for status.
b. On the fourth day, set up an email to go out 36-50 times a day to paypal customer support asking about you account status.

That is all it takes.

Anonymous said...
This comment has been removed by a blog administrator.
Anonymous said...

Propay is a huge scam. They charge the credit cards and take 4-5 days to transfer the money into your bank account. (collecting interest of course!) It is the slowest system out there...
They are able to make up their own rules and if you are a MK Consultant, makes it really hard to process cards through your website without it.
Looking into other options...