PayPal's Unwelcome Mat

Bill You Later or Pay You Later?

PayPal's newest advertising campaign in the UK begun in September and is aimed at retailers. IT asks if they are "alienating" customers by not offering PayPal as a payment method.

The "Unwelcome" campaign, which has been created by Base One, shows shopkeepers holding signs saying "Go Away", suggesting that not offering PayPal is the equivalent of sending customers away. It also intends to highlight PayPal as a secure and convenient method of online payment.

Last week I read this blog by Matt O'Hern I found it interesting for several reasons. Matt has been an eBay user for some years, appears to be an occasional seller but more frequent buyer and played an involuntary game of Bait the Bot.

The next item to catch my eye on the subject was a post from the UK. Cliff Saran of Computer Weekly reports casual users are getting upset and think PayPal should be subject to UK banking regulations.

"As it is, it appears to be completely remote and unaccountable to its users and judging from threads I have read elsewhere appears able to act with impunity, and gets away with it."

Well that is a surprise!

In Australia there is a strong movement lobbying for regulation of PayPal. I wrote that Andrew Pipolo the Managing Director of PayPal has been summoned to a meeting with the Reserve Bank of Australia, which will undoubtedly lead to some form of restriction on PayPal's operating methods. Australia will, in my opinion, be the first of many countries to take a long hard look at PayPal; which is appropriate given eBay's fondness for using Australia as guinea pig country.

In the UK, which is highly regulated, there is growing seller dissatisfaction with eBay and PayPal's propensity for both quoting and enforcing handling and return laws and regulations which do not exist in the format eBay policy requires from sellers. There has been enough 'noise' that some policies have been deferred until after Christmas. Will the UK be country number two to impose regulations?

Given the recent purchase of Bill Me Later there might be grounds for thinking eBay Inc. will have something close to a monopoly on online payments. Perhaps it is time for the FTC to be asked to take a look at the situation. The current trend towards acknowledgment of a need for closer oversight and regulation of financial institutions may well be favorable to those who believe PayPal is overdue for inspection. A complaint to the FTC is the first step.

Those of you who read my blog know that sitting in front of your computer and whining doesn't even make you feel better. It is simply depressing. We have to DO something! Write a complaint to the FTC today. It will take you 15 minutes at most.


Y'all come back!








Related articles and Links:

Computer Weekly Cliff Saran
- More Insanity on PayPal
- PayPal Money Laundering Nonsense
- UK Users Attack PayPal's Anti Fraud Policies

Paperless

eBay's Lorrie Norrington recently announced that as part of a move to achieve complete control of the the entire payment and communication process on eBay "checks and money orders will no longer be accepted on eBay". To clarify that statement, she meant sellers will no longer be permitted to accept checks and money orders, not that eBay will no longer accept checks or money orders.

eBay will require approval of merchant CC payment processing services, and all payment methods are to be fully integrated into eBay checkout. For large sellers who utilize ChannelAdvisor or a similar service this will not cause problems. The small seller who would not qualify on volume for CA has few choices; PayPal, ProPay, try to integrate by yourself or quit. Judging by the recent registrations at Bonanzle hundreds have seen the writing on the wall and are moving on.

eBay will become a de facto PayPal monopoly in the USA.

What is wrong with PayPal only on eBay?

PayPal’s ‘User Agreement’

Users of PayPal’s services are required to accept the terms of a contractual ‘user agreement’, which is posted on the PayPal website. Many of the terms of this ‘user agreement’ are potentially misleading, unconscionable, unfair, or unenforceable. Some specific criticisms of the PayPal ‘user agreement’ include:

• Permit PayPal but not the user to avoid or limit performance of the contract;
• Penalize the user but not PayPal for a breach or termination of the contract;
• Permit PayPal but not the user to vary the terms of the contract;
• Permit PayPal unilaterally to vary the characteristics of the services supplied to the user;
• Limit PayPal’s vicarious liability for its agents; and;
• Limit the user’s right to sue PayPal.

In summary

On the whole, eBay appears to be arguing that:
• eBay's customers, the sellers are incapable of choosing the ‘best’ payment option, according to eBay’s definition of what the ‘best’ option is;
• For those customers’ own good, eBay must force them to use the ‘best’ payment option;
• It is impliedly irrelevant to eBay’s decision-making that the ‘best’ payment option is provided by a wholly-owned subsidiary of eBay, and will result in a significant financial benefit to eBay.

eBay’s argument is condescending and paternalistic at best, and ignores the fact that eBay users are capable of making rational choices about what they view the best payment method to be. Until recently eBay banned Google checkout on the site by categorizing it with 'unsafe and unproven' Payment Services not permitted on eBay. The wording recently changed

Safety and convenience are at the core of eBay’s policies toward payments. This policy is designed to promote safe online shopping, and to encourage online payment methods that are safer, easier to use, and offer high levels of protection for users

This all sounds noble and altruistic. Unfortunately an eBay executive made the following statement on eBayINKblog, the official eBay blog,
finally an truthful and unequivocal statement of the fact we suspected all along.




Well for goodness sakes!

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Links to topical articles:

The Brews News

Yes We Have No Bananas Paypal

As I have said before Ms Nichola Sharpe of eBay's Smoke and Spin Department is not a liar. Saturday's Silicon Valley Mercury News reports "In the United States, an "extremely high" number of eBay transactions, spokeswoman Nichola Sharpe said, are conducted via PayPal." Usher Lieberman of the same department wrote "In the U.S., we are not mulling, planning, or otherwise seriously considering a move to PayPal-only," on the company's eBay Ink blog. To misquote the Immortal Bard..."The lady (or gentleman) doth protest too much, methinks..."

So what is all the furious spin about?

The art of spin by smoke and mirrors requires the target to look and listen to the spinner, not elsewhere. I went and looked elsewhere. The following list of internet payment service providers is taken from eBay's Accepted Payments Policy page Naturally it is tucked away out of sight, click on 'Some Examples' to find it.

Comments to the right are mine. Click here to enlarge. I have highlighted US providers in yellow.

To summarize:
In the USA we have three alternatives to PayPal none of which were designed or intended for auction payment. We have a bank bill payment service, designed for recurring monthly bills from entities who are also participants in the system. We have ProPay, a merchant CC processer, the only thing which distinguishes it from many other similar services is the unrealistically low monthly limits and a very high price, and we have Xoom which charges buyers and requires the recipient give the buyer his bank account number. Xoom appears to be similar in many ways to the banned Western Union but not nearly as convenient.

Talk about comparing apples to oranges!
Here we have an apple, an orange and a papaya to compare to the PayPal banana. The only other banana around is Google Checkout, which is of course banned because "This policy is designed to promote safe online shopping, and to encourage online payment methods that are safer, easier to use, and offer high levels of protection for users" How odd that the only alternatives to PayPal are no safer and certainly not easier to use. Guess we know why PayPal usage is extremely high.

If no competition is permitted on eBay then of course eBay is not 'mulling, planning, or otherwise seriously considering a move to PayPal-only', it is already Paypal only.

Now, please join me in a rousing chorus of the eBay PR department theme song

When you ask him anything
He never answers "No."
He just "Yesses" you to death,
And as he takes your dough,
He tells you:
YES! We have no bananas,
We have no bananas today.

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