Paypal - Good thing or bad thing. I couldn't have started business without it

[nickao]

NOTE* I moved my initial response to this new thread from the thread - Re: Should we pay a subscription to Matt for joining FOG?

Yikes!

I am sure glad everyone does not think  paypal is unsafe. The 120,000.00(arbitrary number) in paypal payments from clients would be out the window. If anything, I have as a seller can be screwed by clients because paypal and the credit card companies. PayPal can and does take the buyers side and pull money from the sellers account and than make the seller send documentation to fight for their money. Even when the client is clearly wrong. Luckily this has happened only once to me due to a really long wait I imposed on the client.

PayPal had a bad rep years ago. It is now owned by eBay and I can not see from a buyers point of view why it is not good. It is mainstream, taken by loads of Festool dealers and every computer company I have dealt with in the last 3 years.

There is nothing paypal can do that rips you off and keeps  the clients money. I should have more qualms as a seller so I don't get why people resist paypal. I had a client explain they were burned 5000.00, someone got a hold of the account, you know what, they were reimbursed in full. That could happen with any credit card also.

You can pay by credit card on my site and never know paypal is even processing the payments(unless you read the small print), so even though paypal is not listed they may be processing payments you are not aware of anyway. You no longer need a paypal account to use the service to pay with a credit card.

When using paypal as long as you use a CREDIT CARD, you are only liable by law up to 50.00. If you use a DEBIT(Checking account) card even at the store, you are liable up to 500.00.

EXAMPLE: If you pay by check on eBay and get ripped off, it is a HUGE hassle to try to get a refund. With paypal it is one call and they take the money from the seller that day. How is a check safer than paypal? I am sorry, but but I disagree vehemently if that is the reason you do not want to use paypal.

So why not use paypal. It has put food on my family's table for 5 years and I have only once had a problem.

It is the smallest companies like mine that must have paypal to accept online payments. If someone is going against going against paypal they are excluding every little company like mine that was not approved by Visa for a merchants account due to it being a new business with a small income, with perfect credit!

I am glad only one person in 5 years refused to purchase because of paypal.  I would not take a check by mail, it just takes to long and is not a paper trail for me like when using paypal.

I say look into it and re-evaluate. PayPal helped make my business viable. Without paypal I do not know how I would have started my business.
I know there are millions of small business like mine throughout the world that could instantly be out of business if paypal went down. I would go as far to say if paypal went down maybe 50% of the very small starting business could be out of their internet business immediately. I would.

In a time of a possible recession I will keep using paypal and send my money to the smaller businesses that use it, need it and can not survive without it.

Go ahead and disagree guys. If anyone of you were denied visa card processing rights because of students loans and little business documentation you would see my point instantly.

Bless paypal and it being directly responsible for me to run an online business, easily, quickly and with little documentation.

Nickao

 

[Qwas]

For a buyer it is great. You can tell PayPal it is the wrong color, and get an instant refund and still have the stuff you bought. Assuming the seller has money in his account to send the refund.

For the seller it is a great risk. Seller beware!!! Keep all correspondence with the customer, know all PayPal policies, and be prepared for a fight.

As a buyer, I got burned once. Bought something on eBay and the seller never sent it. I even have e-mails to back it up. PayPal could do nothing since the seller emptied their account. No refund.

As a seller, I got burned once. Sold a set of golf clubs on eBay and sent them Priority Mail. Buyer says he never got them. I have receipt from USPS saying they were delivered and his postman remembers delivering them. Buyer agrees it was delivered but he never got them. PayPal yanked my money and gave it to the buyer. No clubs, no money, and I was stuck with shipping charges too. And I'm certain the buyer was scamming us. PayPal could care less.

 

[nickao]

For a buyer it is great. You can tell PayPal it is the wrong color, and get an instant refund and still have the stuff you bought. Assuming the seller has money in his account to send the refund.

For the seller it is a great risk. Seller beware!!! Keep all correspondence with the customer, know all PayPal policies, and be prepared for a fight.

As a buyer, I got burned once. Bought something on eBay and the seller never sent it. I even have e-mails to back it up. PayPal could do nothing since the seller emptied their account. No refund.

As a seller, I got burned once. Sold a set of golf clubs on eBay and sent them Priority Mail. Buyer says he never got them. I have receipt from USPS saying they were delivered and his postman remembers delivering them. Buyer agrees it was delivered but he never got them. PayPal yanked my money and gave it to the buyer. No clubs, no money, and I was stuck with shipping charges too. And I'm certain the buyer was scamming us. PayPal could care less.

Qwas I feel for you about getting burned. Thats why I find  it so difficult to understand when buyers think it is unsafe. It is the sellers that take the risk.
The only time I have had trouble, paypal took 1680.00 and since it was not in my account I was in the negative(they paid the client) . They limited my access, I could not even accept more payments! I finally convinced paypal to at least let me accept  payments so the negative balance would take care of itself. Moving from checking to paypal takes forever! Well in this day and age 5 business days seems like forever. So even if the seller does not have the money the buyer still gets theirs. This started Aug 12, 2007 I believe.

I now drain my paypal account if there is ever a substantial amount in the account to prevent that type of thing from happening for the larger transactions. That is - paypal taking my money and making me fight for it. Could you see paypal  taking 5000.00 or 10000.00 and then waiting up to 30 days to fight for the money. All the while needing it for the material etc. And the reason for the dispute is that the buyer waited 15 days instead of 14 days.

Nickao

 

[Qwas]

I've heard that PayPal is going to start holding payments for 20 days. I think it is mainly for eBay auctions and sellers with little feedback but I'm not sure of all the details.

PayPal and eBay have been really pounding on sellers. Increasing rates, limiting accounts, stopping negative feedback to buyers, and much more. So right now it's hard to tell what are rumors and what is really happening until you get the word directly from them. And even then, they try to disguise things. eBay's new CEO sent an email saying they were reducing the starting fees for auctions but neglected to mention they increased the final auction fees. So now we are paying more to sell on eBay but I guess were supposed to feel good because the starting fees are less.

Corporate America is getting terrible. They move our jobs overseas where labor and benefits are much cheaper, don't reduce prices and keep the extra profits, and then find reasons to increase our rates anyways.

Oh well, I can't change it, end of rant.

 

[nickao]

Well that's  bad luck and I feel for you. But I suggest trying them again if the need arises. 3 years is a long time to assume the service is the same.

PayPal is much bigger than it was and I can say in the last three years I have made at least 50 transactions per month through PayPal and had only one bad experience. I just couldn't imagine not having paypal. I don't even have a check book nor written a paper check in three years.

Again I am sorry it didn't work out for you.

Nickao

No I do not work for paypal

 

[Eli]

Well I use it as a buyer and have not had a problem for about six or seven years. My wife uses it for her design business and it was the only way I could convince her to accept credit card payment. Now she sends an email invoice and the turnaround is less than halved I'd say. It's worth paying the fee for the convenience. I don't use it for everything, just those two.

Interestingly, it hasn't taken here in Australia. Almost everything is direct transfer, account to account. Both internet purchases and my pay from production. More secure than you'd think so far.

I'd like to hear an alternative if someone has one. Must be able to invoice via email and accept credit card payment for less money. 

 

[Frank Pellow]

...
PayPal had a bad rep years ago. It is now owned by eBay
...

You say 'owned by eBay as if its a good thing.  Just like I refuse to use PayPal, I refuse to use eBay.

I also refuse to go into the reason's for either of my policies.  Just be aware that I am not alone in may refusal to use PayPal and anyone who wants to collect money for something should provide an alternative to PalPal if they want "business" from me and from folks like me.

 

[nickao]

I have nothing against ebay and though they are tough on the sellers. I do think it is a good thing eBay owned paypal now. As they are interconnected one has to pressure the other to have better service.  In my experience paypal is better since ebay purchased, not perfect, but nothing is.

I  could not imagine not having eBay anymore. I started my business on eBay and have always had relationships as good as the ones here on the "fog". I am truly sorry you had bad experiences with it. In 950 transactions I had one problem with one seller. And in 355 sales total I have never had a return or a problem save one.

Just got a brand new DTS 400 for 127.00, it came in two days with the receipt(stated they paid full price from Berlands house of tools) and is pristine. Great deals there if you are willing to look. And my business went to a small family company that I am proud to purchase from.

You are in the minority now with paypal and eBay I am afraid. As time goes on Internet sales are going to increase whether to eBay or paypal or other companies, but they are here to stay.

In my experience it is a great way to trade, buy or sell and make friends.

Nickao

 

[Frank Pellow]

...
You are in the minority now with paypal and eBay I am afraid. As time goes on Internet sales are going to increase whether to eBay or paypal or other companies, but they are here to stay
....
Nickao

I have no problem at all being in a minority.  (aside: I am often in a minority -for instance with my socialist political views).

But, I am in an important minority.

And, I agree with you that internet sales will increase.  Most of my research for new purchases and a number of the actual purchases are via the internet (even though we don't get the tax break in Canada that folks in the USA do).  But, those purchases certainly never involve either eBay or Pay Pal.

 

[nickao]

...
You are in the minority now with paypal and eBay I am afraid. As time goes on Internet sales are going to increase whether to eBay or paypal or other companies, but they are here to stay
....
Nickao

I have no problem at all being in a minority.  (aside: I am often in a minority -for instance with my socialist political views).

But, I am in an important minority.

And, I agree with you that internet sales will increase.  Most of my research for new purchases and a number of the actual purchases are via the internet (even though we don't get the tax break in Canada that folks in the USA do).  But, those purchases certainly never involve either eBay or Pay Pal.

This is one of those times I am glad to "agree to disagree", its about the woodworking here after all. Oh and my kids just love those airplanes, I see a summer project for the twins on the horizon. Such cute grandkids you have! That was your post with the airplane bookshelves, if I remember correctly.

Nickao

 

[Frank Pellow]

This is one of those times I am glad to "agree to disagree", its about the woodworking here after all. Oh and my kids just love those airplanes, I see a summer project for the twins on the horizon. Such cute grandkids you have! That was your post with the airplane bookshelves, if I remember correctly.

Nickao

Agreeing to disagree with my friends  is a way of life for me.   

And, yes, it was me that posted the thread on the airplane shelves.

 

[vkumar]

I have used paypal for many years never a problem except once. 

I subscribed to a magazine on ebay.  Naturally since it takes 10 to 12 weeks for the first issue to arrive, I could not report feedback (that needs to happen in 4 weeks I believe).  Come 12 weeks no magazine. Contact the vendor and ebay (who asks me to contact the vendor)  and he says "sorry I'll look int it, might take another 6 weeks".  Come 6 weeks no magazine.  Contact ebay, they say contact paypal who (to cut  along story short) says that the transaction is too  old and they cannot do anything about it.

So the moral of the story is never to buy any magazine from ebay using paypal or actually any form of payment, since it takes too much time to process magazines.  Thsi is actuall more of amagazine story than a paypal or enay story but they are all mixed in there.

Vijay

 

[nickao]

That happened on my one bad occasion I had as a  buyer. I just called the credit card I used. They immediately reversed the charges even thought the transaction was 4 months old. That is the main reason to use a credit card even when using paypal.

But again it is the seller that ripped you off not ebay  or paypal.

Nickao

 

[vkumar]

That happened on my one bad occasion I had as a  buyer. I just called the credit card I used. They immediately reversed the charges even thought the transaction was 4 months old. That is the main reason to use a credit card even when using paypal.

But again it is the seller that ripped you off not ebay  or paypal.

Nickao

Well both ebay and paypal refused to do anything about it since it was "too old". I never tried the credit card bank since by then it was over 6 months.  Maybe I should have.

Vijay

 

[tvgordon]

I've only bought a few items on ebay, but used paypal each time without any problems. 

Nickao, if you don't mind me asking, what type of business did you start on ebay?  I believe you said you used to be a contractor?

Tom.

 

[alg]

I treat eBay and Paypal as a service. I have used both since they started. And can count 1 or 2 bad experiences with each and in all but one, they were able to fix to my satisfaction. The responsibility really falls on me as the buyer to make sure I have assessed the seller sufficiently enough to proceed with the transaction. I am the one who hits the Pay button. So, ask enough questions to have a good feel. My gut feel has worked for me.

 

[wotan]

Man, this topic is so timely,

I am a seller on ebay, mostly in the winter when work slacks off. I sell records and audio tube gear. I am in the middle of a dispute  on paypal while i write this reply.
It's incredible how impatient buyers have become, I sold a quartet of output tubes and one was not tested. I was selling for a friend and he neglected to test one tube. The buyer tested the tubes and found the bad one. We emailed back and forth and I proposed a total refund, but he agreed to a partial.
Well he took his sweet time in mailing it back from Thailand and when i failed to be home to sign for the package,( I admit that I received the second notice from the post office) he instigated a dispute and now my account is frozen.

I made the partial payment, but the money came out of my bank account, not the paypal one.  If you sell, always save  your transaction emails. If you don't you might end up losing more money that you bargained for.

 

[semenza]

Hi,

    I started using PayPal before it was owned by Ebay.  I have used it hundreds of times both as a seller and buyer. I have not had any problems with PayPal from either side.  I have had a dispute from a buyer once. And had a problem with some counterfeit merchandise that I bought once. But in both cases PayPal worked the way it was supposed to work.  The problems were not with PayPal but with the transactions / merchandise.

Seth

 

[Dave Rudy]

This is an interesting thread.  I just learned that Frontier Airlines (which I fly a lot) filed for Chapter 11 reorganization yesterday.  The stated reason:  a credit card processor decided to increase its "holdback" starting today.  I assume the holdback is what a credit card company keeps from paying to the merchant in case there is a dispute and some money has to be refunded to the buyer.

I believe Federal law requires that a credit card company refund charges pending investigation whenever the buyer claims fraud or non-performance of the seller.  Will those who have had the experience please explain what process paypal goes through to let the seller validate the charges.  In other words, is it possible for a seller to ever "win" the argument with a buyer and have the charges stand?

 

[nickao]

This is an interesting thread.  I just learned that Frontier Airlines (which I fly a lot) filed for Chapter 11 reorganization yesterday.  The stated reason:  a credit card processor decided to increase its "holdback" starting today.  I assume the holdback is what a credit card company keeps from paying to the merchant in case there is a dispute and some money has to be refunded to the buyer.

I believe Federal law requires that a credit card company refund charges pending investigation whenever the buyer claims fraud or non-performance of the seller.  Will those who have had the experience please explain what process paypal goes through to let the seller validate the charges.  In other words, is it possible for a seller to ever "win" the argument with a buyer and have the charges stand?

Yes, I have won. All I had to do was provide the tracking info that showed the package was received by the purchaser. It is MUCH safer to require a signature. Even if UPS can verify that the package was dropped off, the client can say it was stolen off the porch. Which is the clients problem. I have heard stories that paypal found in the buyers favor in those cases though.

Unless the purchaser(buyer) can provide tracking and confirmation that the item was sent back and received by the seller, the buyer will lose.

Though I have very specific terms and conditions on my site, if the buyer disputes and I can not show tracking, even if the terms and conditions say the buyer must wait 12 weeks for delivery(and the buyer agrees) and the buyer files a complaint at two weeks, paypal will find in the buyers favor. Which is crap, the buyer is just trying to get out of a cancellation fee and/or non refundable deposits.

I highly recommend upon check out you direct the buyer to the terms and conditions and make them check an agree button for the the terms and conditions, separate from just stating on your site " buying from this company means you agree to the terms and services". That is one way to help paypal favor you as a seller. If you can email them(paypal) a separate sheet with the terms and conditions that state the buyer agreed to them, other than just purchasing, again the seller will win.

Paypal's SELLER issues are exactly why I find it hard to believe any buyer would be afraid to use paypal. Even if paypal does not help the buyer,  the buyer can then go to the credit card companies in Addition to paypal. Even if paypal agrees with the seller there is NOTHING paypal can do for the seller if the buyer gets the credit card company to reverse the charges. Now the fight is with the credit card company. PayPal usually dismisses anything over 8 weeks. The next step for  the buyer is going to the credit card company. The credit card companies will usually listen to the the buyers complaint if the transaction is 90 days old all the way to 365 day old, depending on the specific credit card company.

I think the Frontier issue is a little more complex because if they were just holding back fees to disperse at a later date, that is still Frontiers income. I suspect the credit card company actually changed the charging format in addition, ie higher fees. If the credit card companies get loads of complaints and/or charge reversals they can and do charge the seller more in UP FRONT fees and PERCENTAGE of transaction fees.

A large company like an airlines has specific agreements with the credit card companies which are not the same as a small business that is covered by a general terms and conditions clause issued by the most credit card companies. I could not possibly guess what is in Frontiers agreement with the creditor they are using.

Nickao

DISCLAIMER - This is based on MY limited experience with paypal and credit card companies. Others may have had different experiences. I suspect any buyer with a paypal issue had them before paypal took "the buyer is always right" stance a couple of years ago.

I am sure sellers can tell many more horror stories than buyers.