Published: December 9, 2008
This past October, eBay sellers and buyers awoke to a new world order with the online auction platform’s announcement that it was moving to electronic-only payments. The change, which attempts to end a buyer’s ability to pay for an item with a check or money order, was announced by eBay representative Dinesh Lathi on October 21 on the site’s service announcements section.
Since then, all items listed on eBay must be paid for using approved electronic payment options, including direct credit or debit card payment via a merchant credit card account, PayPal or ProPay, a third-part payment company.
Lathi said the firm’s new paperless payments policy means “sellers will no longer be able to list an item without one of the approved electronic payment methods: PayPal, credit or debit card payment to a seller’s merchant account, or ProPay.”
Meanwhile, eBay has been conducting online workshops to help sellers adjust to paperless payments, as well as fielding questions, many of which express skepticism and irritation at a change that seemingly provides benefits to eBay but limits payment options for sellers and buyers.
The online auction venue is urging its sellers to remove any references to prohibited payment methods in their item descriptions. “If you only offer checks, money orders or other prohibited payments, in October you will need to add PayPal or sign up with ProPay,” an eBay representative posted during an online workshop. In response to one participant’s question, however, the representative said that a seller can accept check and money order payment from a buyer if the buyer requests it.
Officials at eBay say the new policy is better for both sellers and buyers. On the sell-side, integrating the new payment methods into eBay checkout keeps transactions on the site. The firm cites statistics that bidders who pay with a check or money order on ebay.com are 80 percent more likely to file an “item not received” dispute and 50 percent more likely to leave negative feedback.
On the buy-side, eBay argues that if something goes wrong in a transaction, the buyer is likely to have more recourse through the electronic payment methods. Overall, the firm is stressing that the payment changes should serve to “increase buyer confidence in shopping on eBay, which should result in increased sales for [our] sellers.”
PayPal, the much maligned electronic payment clearinghouse for eBay, is trying to mitigate the sting by increasing the previous limit of $10,000 per transaction, and is offering an introductory promotion to eBay’s sellers who currently only accept checks and money orders wherein if they sign up for PayPal, they will not have to pay any fees for the remainder of this year.
Still, the anti-PayPal faction is chafing even further under this narrowing of payment options, and as the comments and discussion on websites like screw-paypal.com illustrate, eBay will continue to have to deal with a restive community of buyers and sellers.
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