Over the last eight or nine years we have had numerous one-time customers and repeat customers who have paid with money orders.

Is eBay excluding such buyers from the eBay marketplace simply because they do not have a credit card, a PayPal account, or in some cases, a bank account? Some former buyers may see this new policy as a form of economic discrimination.

Propay fees are higher than PayPal, and so are most other credit card merchant accounts. It is therefore obvious that most sellers will continue to accept PayPal payments – which will benefit eBay monetarily.

Excluding all of the buyers who can only pay with money orders may lead to less sales volume on eBay.

There have probably been numerous buyers who do have credit cards, but who simply preferred not to place their credit card number or bank information online with any secure website. Telling such customers that they must now use their credit card when purchasing items on eBay may drive them away from eBay forever.

From Ina at Auctionbytes:

At some point during the week of October 19, PayPal’s system experienced a glitch involving eCheck payments made to eBay sellers. PayPal has been holding the payments captive ever since – and the glitch appears to be ongoing. Sellers are concerned about not being able to access their money, and are also worried whether buyers would be able to cancel orders for items already shipped. If they don’t ship items because they have not received funds, sellers are concerned buyers will ding their reputations – especially since eBay has failed to publicly report the problem.

(snip)

Sellers report that even after payments show up as “cleared,” the funds do not show up in their account. Instead, PayPal displays them as “unclaimed,” and there is no way for the eBay sellers to claim the payments. eBay does not allow sellers to ban PayPal eCheck payments, and many buyers often don’t realize when they are using eChecks to pay for goods.

eBay sellers find themselves in a bind, since they are now required to accept PayPal if they do not have their own merchant credit card account, which many do not. Since PayPal is not a bank, it appears to be unregulated, and users have no recourse when the service holds its funds without explanation.

Here are my follow ups ;)

With regard to trading off eBay using PayPal, you do not get full buyer protection and generally when you are trading off eBay, you are vulnerable to other types of scams. It’s always recommended to stay on eBay and use PayPal because it is fast, convenient and safe.

If you pay via Paypal off ebay and use a credit card as your funding source, you are just as protected. Why? Because you have your chargeback rights through your CC provider if Paypal doesn’t honor their protection guidelines.

As for convenient, the NUMEROUS issues with Ebay checkout and Paypal coupon codes lately have not made paperless payments very convenient.

And Rich,

If eBay or PayPal becomes aware of fraud or that individual buyers are abusing the system they will take action against them

The sellers are understandably concerned that the shielded bidders id will make this type of fraud even more difficult to detect.

Here’s the bigger issue with the SNADs. Since they are now included in the Seller Non Performance calculation, buyers are extorting sellers at breakneak speed. They threaten sellers with SNADs in an attempt to extort a partial refund. They are not happy with returning the item (since they really want a post-purchase discount) and know the negative consequences sellers face if they get too many disputes filed against them. So they threaten them. And since this happens post-transaction, all complaints sent to ebay are seen as ‘dissatisfied buyers’ rather than the extortion that really takes place.

I’d love to see the percentage of SNADs that are decided IN THE SELLERS’ favor. I bet it is miniscule. Paypal seems to have dropped the ‘significantly’ part of the clause entirely when reviewing disputes.

Finally, the expanded seller protection for international transactions is absolutely meaningless in an environment that includes Detailed Seller Ratings.

The only way to get protection against Item Not Received complaints internationally is to ship by the most egregiously expensive methods available that result in either excessive brokerage fees (if sent by carrier) or excessive postage (if sent Express Mail).

Neither option is really viable when buyers can rate sellers on shipping charges that are set by the carriers. Consistently poor DSRs, even if shipping at cost, can result in the demise of an eBay business.

So, for most of us who ship internationally, the fine print in the SPP renders any protection illusory.

Drop SCO, stop PayPal from sending emails with clickable links and the problem goes away.

This issue is causing problems for thousands of people worldwide.

PayPal is holding money under the guise of unlaimed eChecks.

Sellers get a note like this:

Don’t forget to claim your money from (buyer name)

Dear (Seller’s name),

Claim your cash

You received $4XX.XX USD from (buyer email) on Oct. 26, 2008. If you do not claim your money by Nov. 25, 2008, this transaction will be cancelled and the money will be returned to (buyer email)’s account.

Log in to your PayPal account to view the details of this transaction.

You need to manually claim this money because:

You are one of our high-volume customers. We ask PayPal users who receive more than $10,000.00 USD per month to complete our Supplemental Merchant Information form.

To fill out the form, click the link below:
Link to PayPal US

The information you provide helps us protect the integrity of our network. Payments sent to your PayPal account will be held as “Pending” until you complete this form.

If you have questions about this payment, log in to your PayPal account and click on the History subtab. Click the details of the payment in question for more information, or to accept or deny this payment.

Thank you for using PayPal!
The PayPal Team

Please do not reply to this email. This mailbox is not monitored and you will not receive a response. For assistance, log in to your PayPal account and click the Help link in the top right corner of any PayPal page.

PayPal Email ID PP288
—-
Most of the sellers that come to the boards to complain about this do not make $10,000 a month so that is a lie as to being the reason that they are putting a hold on the funds.

What is worse is when you try to “claim” these funds, there is no way to do so.

This has been going on for more than a week and in some instances, the sellers are waiting for fairly large sums of money to be released.

All the while, someone is collecting interest on this money that was paid to the seller BUT it isn’t the seller collecting interest on it.

Buyers are getting no notice about what is going on. If they check, they will see that the amount is “unclaimed” and all they know is that they are waiting.

We don’t know why this is happening for sure but the one thing we do know is – sellers stand to lose on the feedback & DSR’s and PayPal is collecting interest on our money.

Check eBay’s PayPal discussion board for more about this as it is also holding up other methods of payments. The title of the thread is “Can’t claim cleared eChecks!”

Is this a PayPal glitch or have our accounts been compromised by a disgrnatled laid off employee (the timing of this is suspicious)?

Regarding the need for anonymization of winning bidder IDs we found that fraudsters would grab the Winning Bidder ID (since it wasn’t hidden) immediately after the auction ended and send the winning bidder “Fake Checkouts” before the real seller could.

Why not just REMOVE the “high bidder” line on the item page, and the “list of bidders” completely? They are absolutely useless now and serve more of an annoyance to everyone, and display the arrogance of eBay more than anything else. Just display this information to the seller, and take it away for anyone else. You’ve already taken it away, please, just remove it so it doesn’t even show.

Thanks for your comments.

I’ve been spending some time with the PayPal team since I’ve been on board. PayPal is one of the safest payment methods online with the payment industry’s lowest fraud rate and the only system that offers the kind of protection that they do with no cap and no annual coverage limit on eligible transactions— and compared to what I’ve seen over the years, that’s pretty good protection!. PayPal’s been around for a long while and grown up with the Internet and payments industry and is uniquely positioned to take on the ever-changing challenges of online fraud—this is what PayPal does best. Nevertheless they are always looking for ways to improve; PayPal has made a number of changes this year to enhance PayPal Seller Protection in response to specific requests from eBay sellers — increasing the number of markets covered, removing the coverage limit, removing the confirmed address requirement, and making it easier for sellers to provide proof that they sent the item. We appreciate your concerns about SNAD and I’ve been assured by the team that PayPal is looking at ways to improve seller protection even more, including better protection for SNAD. It’s important to keep in mind that PayPal is a payment company, which means it doesn’t handle or see the millions of items of merchandise shipped each week. Like other mainstream payment providers, this model makes it extremely difficult for PayPal to intermediate in all types of cases. If eBay or PayPal becomes aware of fraud or that individual buyers are abusing the system they will take action against them. eBay has over 2000 anti-fraud experts working around the clock on all types of fraud. Otherwise, they encourage buyers and sellers to work with each other directly or via the PayPal Dispute Resolution console.

With regard to trading off eBay using PayPal, you do not get full buyer protection and generally when you are trading off eBay, you are vulnerable to other types of scams. It’s always recommended to stay on eBay and use PayPal because it is fast, convenient and safe.

Thanks again for writing.

Rich

Thanks for your response and concerns about counterfeits.
You make an excellent point which is that addressing counterfeiting requires a multi-pronged approach– not only consumer education but also strong criminal and civil enforcement. In my former role as Director of Worldwide Anti-piracy Investigations at Microsoft, I quickly learned that the only strategy that really works is an integrated approach where everyone has to do their part, including the consumer. eBay works with over 18,000 Intellectual Property Rights owners through the Verified Rights Owners Program (VERO) to rid eBay of counterfeits. We have over 2000 fraud specialists who monitor transactions for evidence of fraud and also work closely with law enforcement. They have been successful in reducing fraud visibility by about 80% over the past year. However, it is important that buyers exercise some basic common sense practices regarding listed items—the old adage, “if it looks too good to be true, then it probably is” still serves us well.
Rich