PayPal The Naked Truth Part II

Protection for Buyers

eBay has been running a series of risque advertisements for PayPal in Australia, one featuring a middle aged woman saying "I've done it with 90 different people, but I used protection". The big push is to promote buyer confidence, and it is hard to find fault with that. As is usual with anything eBay does, which naturally includes all subsidiaries, the baggage which accompanies any policy is to promote the bottom line, profits.

What exactly is PayPal Buyer Protection?

eBay has five separate programs:


1. Item Not Received (INR which is also sometimes referred to as Seller Non-Performance (SNP or NPS)) or Significantly Not As Described (SNAD). eBay says

Note: Your eligibility for reimbursement through our buyer protection programs is determined by the payment method that you’ve used and the eBay country site where you have purchased the item.

If you have paid for an item, but didn’t receive it, or you paid for and received an item, but it was significantly different from the item description. Note: If you paid for your item with PayPal, you'll be taken automatically to PayPal to file a PayPal Buyer Protection claim.eBay facilitates communication between the buyer and the seller through the dispute console, an online communication tool. All information posted in this tool will be accessible anytime by you, the seller, and eBay Customer Support.

Here is the link to the eBay policy page.

What is it in reality?

An automated (bot driven) venting space which is not seen by a human unless and until it is escalated to a claim. Then "Our Trust and Safety team may take appropriate actions if they find the seller has violated our Seller Non-Performance policy."
Red INK Rating



2. PayPal Buyer Protection eBay says

PayPal Buyer Protection Policy only applies to items purchased on eBay or to payments funded through your debit card and processed through the ATM debit network. If you have paid for the item through PayPal, up to $200 (Basic Tier)or $2000 (Top Tier Coverage Amount) at no additional cost. See eligibility.

Henrietta says the fine print is too voluminous to put here!

What is it in reality?

Basically if you meet all eight eligibility requirements specified in Section 13.8 of the PayPal User Agreement; and follow exactly the seven steps of the Claims Procedure specified in Section 13.7 of the PayPal User Agreement; PayPal will cover you up to $200 if the seller does not. Need more? Pick your seller very carefully and meet all six eligibility requirements specified in Section 13.9 of the PayPal User Agreement. Risk to PayPal, very very low.
Red INK Rating



3. PayPal Buyer Complaint Policy PayPal says

PayPal Buyer Complaint Policy - Our best efforts program to reimburse Users for losses only to the extent we are able to recover the funds from sellers.

The PayPal Buyer Complaint Policy only applies to items purchased outside of eBay or eBay Express. If we grant a Claim under our Buyer Complaint Policy, PayPal will seek to collect from the seller by debiting the seller's PayPal Account up to the amount of your loss, and you will receive a recovery to the extent that the seller has funds available in the Account at the time we debit the seller's Account. If there is more than one Claim against the same Account, we will process the Claims in the order they are filed, and will pay out on each granted Claim up to the amount of funds in the seller's Account at the time the Claim is awarded, but not more than the amount of the Claim.

What is it in reality?

Worthless! A crooked scamming seller will have very little in the way of funds in their PayPal account. Buyer will be SOL. An honest seller will bend over backwards to settle any transactional problems with a buyer.

Risk to PayPal, zero.
Red INK Rating, I am looking for another bomb.



4. eBay Standard Purchase Protection Program eBay says

If you make a purchase from one of the eBay websites listed below,(Hong Kong, New Zealand, Poland, Singapore, Sweden) you may be eligible for the eBay Standard Purchase Protection Program (eBay SPPP) instead of the PayPal Buyer Protection Policy. The eligibility requirements for eBay SPPP are the same eligibility requirements for PayPal Buyer Complaint Policy as listed above. eBay Standard Purchase Protection Program is our program to reimburse buyers for losses up to the applicable coverage amount minus the processing cost for purchases made on the eBay SPPP websites.

What is it in reality?

Worthless and expensive! Processing fees appear to be 12% or greater. A crooked scamming seller will have very little in the way of funds in their PayPal account. Buyer will be SOL.

Risk to PayPal, zero.
Red INK Rating, I am looking for another bomb.



5. eBay Motors Buyer Services & Protection eBay says

The eBay Motors Vehicle Purchase Protection (VPP) program provides protection of up to $50,000 against certain losses associated with some types of fraud. You are automatically enrolled in the program at no charge when you complete the purchase of an eligible vehicle on the eBay Motors site

This program is administered and managed by an independent service provider that is not affiliated with eBay Inc.

Overall Impression

The whole thing is so lawyered up that most claimants will give up. This may be the intended effect. The differences between Standard Purchase Protection, Basic Purchase Protection and the Buyer Complaint Policy are so 'fine print' that I doubt any eBay Live Help Customer Service Representative can give correct advice. Lotta smoke and plenty of mirrors here. No real protection. I will not purchase anything online without using my Credit Card, that is simple to do and easy to claim on should the necessity arise. Best advice to buyers? Do your homework, study your sellers 'feedback left for others' and read the listing.

Next PayPal post will cover seller protection, it will be much shorter.



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Then eBay . . . Blinked

eBay Australia has announced that it is withdrawing its application for a waiver from the Trade Practices Act 1974. eBay has apparently realized that despite all the bluster, threats and arrogant statements, in Australia the law is the law and it applies to eBay too.

It is my opinion that eBay is concerned that the current accepted payments policy

eBay requires all sellers to offer PayPal as a payment choice on eBay.com.au along with other permitted payment methods of their choosing.

together with the Misleading and Discouraging Payments Policy might be ruled contrary to the Act and is hoping to avert this unintended consequence by withdrawal.

On calling the ACCC Thursday afternuoon (their time) I was informed that anyone can file a complaint and that the ACCC will investigate. The ACCC has the power to prosecute when it finds violations. The complaint form is here

Any complaint should reference:
1. eBay supplies services (listings) on condition that the purchaser (eBay seller) buy financial services from a third party (PayPal) and refuses to allow listings if the seller will not agree to that condition.
2.This appears to be third line forcing contrary to Section 47 of the Trade Practices Act 1974

eBay originally stated that the PayPal only in Australia Plan would be implemented in two stages. From their notification:

Specifically, under the Project it is proposed that:
(1) effective on and from 21 May 2008, eBay will amend its User Agreement and alter the functionality of the eBay Site such that all sellers (including both new and existing sellers) will be required to offer PayPal as one of their accepted payment methods;

Here is the definition of third line forcing from Section 47 of the Act:

Third line forcing is a specific form of exclusive dealing prohibited outright by the Trade Practices Act. It is not subject to the substantial lessening of competition test. It involves the supply of goods or services on condition that the purchaser buys goods or services from a particular third party, or a refusal to supply because the purchaser will not agree to that condition.

What do you think?


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AND Another One Bites The Dust UPDATE

This is exactly the type of bad seller eBay needs to route off the site. NOT.

PowerSeller webarker has been selling jewelry and collectible pocket watches on eBay since March 31st 1999, listing both auctions and in their eBay store. With a feedback score of 34,807 and a total 46,322 transactions on eBay, this seller ranked #2882 on the top eBay sellers ranking table.

PowerSeller webarker had an Average Sale Price of $51.51, monthly statistics show that this seller listed an average of 691 items a month with an incredible sell through rate of 72.65%, Gross Sales averaged almost $26,000 a month. That translates to over $310,000 a year.

PowerSeller webarker no longer has any items for sale on eBay. Not one.

But why you ask? What happened?

PowerSeller webarker got 2 negatives from non paying bidders in June. Bidders who failed to read the Terms of Business. Bidders you might want to put on your blocked bidder list if you are still trying to make a living on eBay.

There comes a point in time when it just is not worth it any more.

UPDATE:
One of the bidders (270241901181) chose to ignore the sellers Terms of Service which stated in big red letters in the listing NO PAYPAL. In my opinion that is like walking into Macys and insisting on paying with Swiss Francs because it is a more stable currency. Macys does not take Swiss Francs in the USA and Webarker should not have to take PayPal if he states that in his listing. He accepts Credit Cards, personal checks and money orders.

Y'all come back

Pulling Levers on eBay

There is a whole lotta trading going on. eBay opened at $27.01 this morning down from $27.33 at close last night. Trading has ranged between $26.97 and $27.48 today.

Last year Ina Steiner at AuctionBytes wrote about eBay's slot machine venture. Licensing the eBay name for one-armed bandits was not out of character for former CEO Meg Whitman who was fond of pulling levers as needed to tweak eBay performance at strategic moments.

As eBay's remaining sellers, overwhelmed by the recent avalanche of changes without clear guidelines or implementation dates pull listings for revision to avoid arbitrary suspension, eBay is wildly pulling levers.

Scott Wingo blogged on eBayStrategies last month about "copious couponing" with eBay Bucks plus cash back offers from PayPal and Microsoft's Live search engine. This was followed by a double discount eBay Bucks coupon.

Today UK sellers received notification of a two week 1st July to 15th July 2008 inclusive *one penny per listing* offer from eBay.co.uk, limited to businesses listing in technology categories. Another offering for our brethren across the pond says:

Push the frontiers of your eBay business with this by-invitation-only special for selected sellers. If you’re a verified PayPal user and have never listed in the US, say howdy to the exciting eBay.com marketplace with US$0.10 insertion fees on Auction and Fixed Price listings.

BUY THIS Card!
In my search for references I came across this delightfully nostalgic puff piece from U.S. News and World Report published Halloween 2005. The article contained these quotes:

From the article; First, she realizes she can't control eBay's community of buyers and sellers, because they don't report to her and if they're dissatisfied, they don't have to show up for "work."... Anthony Noto, at Goldman Sachs "The eBay community is a democratic state ... and from Meg "Don't assume you know more than the marketplace or community--because you don't."

As my friend Ed says "Are they feeling the squeeze of the seller exodus?" Seems to me there might be some subtle messages for John Donohoe in those quotes up above.

Y'all come back