posted on October 4, 2000 06:58:21 PM newCorrect me if I am wrong, but doesn't Billpoint charge for charge backs? I may be wrong, but I do know that other competitors can charge for charge backs.
Yes, billpoint allows/charges for chargebacks. That is my point.
Billpoint does not employ the convoluted, invasive process that paypal would have us believe is "verification." Yet, as you pointed out, billpoint does indeed allow chargebacks.
Gee, I wonder how they manage it, without "verification" and all.
It's time paypal stopped underestimating the intelligence of its users, most of whom knew instantly that this "verification" process is a PR soundbite for "sucker."
posted on October 4, 2000 07:44:56 PM new
With the experience I just had with a chargeback as a consumer, I'm not worried about it. The credit card acts as the judge and they seemed to be pretty fair about it.
Why would chargebacks be a problem to a seller that isn't trying to rip people off and packs their shipments decently?
I too have some issues with Paypal. I am thinking of switching over to ExchangePath or PayDirect myself. Perhaps their customer service will be better. Here's the long story:
I recently accepted Paypal from a buyer with a shipping address in Thailand. Buyer stated that friend in U.S. would pay with Paypal for him. Okay, I've done this before with BillPoint with a Macedonia buyer.
I received Paypal with instructions to send Global Express with insurance to Thailand. I called Paypal Customer Service, 9/29/00, Friday 8:30am, to verify if "friend" actually approved or not. I explained that it was important that I receive a call back right away. I left my home and mobile number. Customer Service (CS) suggested that I keep the money in my Paypal account in case it is fraudulent.
Of course, with all my dealings with banks and credit card institutions, I receive call backs on fraud inquiries in a few hours. So Friday evening comes and no one calls. I think, "no news is good news." I ship the package.
Four days later, I receive a message on my home answering machine. CS is closed by the time I get home. I received another call from Paypal CS Wed. morning. They told me Paypal account I received money from is fraudulent. Since I shipped to an overseas address, the Verified Buyer Protection does not apply to me. Paypal is withholding those fraudulent funds from my account. (At least they learned not to lock the entire account!)
Honestly, how many users actually read every single line in the fine print? I thought I was protected because I am a verified seller. Now I am out merchandise and a lot of money. I asked to have the Global Express package recalled from Thailand, but I am not hopeful at this point. Too much time has passed.
What do you all think?
Frustrated,
Sun
p.s. Here is the partial text of the e-mail I received. Item D applies in this situation:
In order to retain the funds from a fraudulent payment that you received from [fraudulent_user], PayPal will withhold [amount] from your PayPal account balance.
Please note that this withholding is in accordance with our Terms of Use, Section IV, Paragraph 3:
"X.com agrees to indemnify sellers for charge back liability resulting from buyer's fraudulent use of a stolen credit card
and/or false claims of non-shipment of goods for purchases made through the Service for up to $5,000 per year when the following
conditions are met:
a) The seller is Verified;
b) The seller can provide reasonable proof-of-delivery which can be tracked online. (Most U.S. carrier companies offer this
service, including the U.S. Postal Service.);
c) The seller accepted payment from only one PayPal account for the purchase. (Multiple payments from different accounts for a
single item are a fraud indicator. Sellers should not accept such payments.);
d) The seller does not ship internationally (when X.com releases international payments (coming soon), this rule will be replaced
with a list of approved countries)."
edited to take dollar amounts out.
[ edited by sun818 on Oct 4, 2000 08:26 PM ]
posted on October 4, 2000 07:50:47 PM new
<<Why would chargebacks be a problem to a seller that isn't trying to rip people off and packs their shipments decently?>>
If the cc was stolen, or just the infor was stolen, not all authorization processes catch this.
So a seller ships the item. The real cc owner says I never authorized that charge, nor received any merchandise, give me my money back."
Once the cc company finds this out, they chargeback the seller.
So the seller is out of the money, and the item since it was shipped weeks or months ago.
That is one very good reason an honest seller can fear chargebacks.
posted on October 4, 2000 07:51:38 PM new
Well, since DAY 1 with PayPal, I have ALWAYS recommended that you have a combo PayPal X.Com account. X.Com is a FDIC BANK and if you regularly transfer funds to your X.Com account, you will not lose much if PayPal goes belly up - as the Feds will protect the money in your X.Com account. The X.Com account can be used to verify the PayPal account - totally leaving your real world accounts out of the mix. I do think the new X.Com requirement to leave $100. on deposit really stinks - and gives X.Com no great advantage to any normal local checking account. It does at least keep the online system sealed away from your analog world banking. I am going to check out some other online banking options - and lord knows there are plenty of payment systems out there that are still free, or cheaper than PayPal - several who are also offering incentives still. They might eventually start charging, but with the way things go, there will always be new ones coming along. Use em and leave em they sure don't seem to act in any way that makes me think they care about customer LOYALTY! -Rosalinda
TAGnotes - daily email synopsis about the Online Auction Industry http://www.topica.com/lists/tagnotes
posted on October 4, 2000 08:09:44 PM new
labbie1:
So I can't take the same info as in your post and submit it for a credit check?
Sure you can. But with a credit check, PayPal can verify:
A) Credit card billing address as supplied by the customer matches the address on the credit report.
B) SSN supplied by the customer during registration matches the one on the credit report.
C) Phone number supplied during registration matches the one on the credit report.
D) First and last names supplied by customer match those on the credit report.
With bank account "verification", PayPal can verify none if this. The ONLY thing they can "verify" is that the customer is able to find out the 2 verification deposit amounts. As explained earlier, s/he doesn't even have to have access to the account to do this. s/he can find discover this information in a 5 minute phone call to the bank.
If there is a discrepancy between the info supplied during registration and that on the credit report, PayPal can request documentation from the user to explain the discrepancies, such as copies of a utility bill, driver's license, bank statement, etc. A possible inconvenience for a few honest customers? Of course. But the average user will be verified in seconds DURING the registration process. And while this (or ANY verification process for that matter) certainly isn't foolproof, it is heads and shoulders above the bank account scheme for reliability.
posted on October 4, 2000 08:24:58 PM new
Rosalinda--
X.com/First Western National Bank is no longer accepting applications for new checking accounts, but "recommends" that folks wanting checking accounts use the non-FDIC-insured Paypal service instead.
This all keeps looking fishier and fishier. When was the last time you heard of a bank refusing to accept new depositors?
posted on October 4, 2000 09:57:20 PM new
I have an XCom checking account and didn't know about the $100 balance requirement. I wrote a check and there will be less than $100 in the account. Will I be shot at dawn? I only use it for PayPal transfers and don't keep much in it.
First all of the credit lines were eliminated, now there must be a $100 balance, and the bank is not opening any new accounts, something is afoot.
"I have heard PayDirect mentioned on here. I know it is free now, but I also suspect that will change."
You are correct. This will eventually change, but they have said that from the start. Unlike PayPal!
Knowing Yahoo, the fees, when they get around to charging them will be reasonable.
"It has only been this last week that I have been getting hardly any PayPal payments from people. I can see how this could mount up."
That's correct. I was doing some figureing and somehow, the PayPal fees would add up to about half as much as my Ebay fees [on auctions people paid for using credit card transactions through PayPal]. That $.25 flat fee really hurts. It's kind of like adding an extra listing fee to the auction.
posted on October 4, 2000 11:10:54 PM new
Likewise, I have been a victim of a silly hacker's cute antics = sending me a paypal payment with a stolen credit card. It is true that Paypal has responded with the same accusatory actions on my account. At this point it is comical, however we (our company and legal counsel) believe that they have overstated their position to the point of possibly accusing ME of a crime or defaming my name. These types of policies need to be worked out in a growing enterprise, we understand that and are not quick to file suit, however Paypal's growth spurt is continuing to absorb their focus on quality customer service. We feel that sooner or later a class action suit will follow, forcing Paypal to follow guidelines set by banking institutions and good ethics.
posted on October 5, 2000 06:09:39 AM new
I hadn't noticed that you have to be verified to be protected from chargebacks.
Verification requires that you give PayPal permission to take money out of your bank account when they want to, even though they don't need to have this permission to verify you.
So if you don't want to give PayPal this permission that little feature is useless.
By the way - why is 'permission' this one way gate? How do you withdraw permission for this?
If you do - do you immediately become unverified again? I can't see that PayPal can not listen when you withdraw permission - not legally. Of course they can just not have anyway for you to notify them and no way to record that.
Seems like something that could get them in trouble liability wise by not recording that information.
I wonder how they would like it if every 'verified' customer sent them a registered letter withdrawing permission or notified their bank that PayPal was restricted from withdrawing funds from their account.
Try explaining to all these customers that the reason PayPal needs permission is because they won't withdraw any money unless the customer asks them to.
It does specify that PP will only take money out if you initiate it.
They have made some mistakes even before the verification was in place and taken money out of people's accounts (like mine), but as far as I know they did replace it after a few months and some e-mails, phone calls and faxes.
posted on October 5, 2000 07:56:42 AM newabingdoncomputers Of course I don't trust them. That is why I am no longer offering them as a payment choice on my auctions.
And as I said, they already took money out even before the verification which took some work on my part to get it back.
I just wanted to correct that their TOS states (at this time) that they won't take money out without you initiating it.
Even if I did trust them before, with this new xcom weirdness, I wouldn't.
(Remember that I am the one that refuses to give my SS#? )
posted on October 5, 2000 11:14:50 AM new
Hi abingdoncomputers,
All customer transactions (payments,withdrawals,deposits) are customer-initiated for security reasons. That is why I can't reverse a payment sent to another party on your behalf, regardless of the status (claimed or unclaimed).
Bank account information is regulated under federal law and we would not, will not access your bank account information without your permission.
posted on October 5, 2000 11:38:37 AM new
Hi Damon:
I'll repeat myself in case you missed my last post: Do you expect us to actually trust PayPal's word (their TOU) after everything that has happened in the last 90 days? I'm sorry, but the trust is gone. Sure there are quite a few sellers who still use PayPal. But I'll bet that most of them pull the cash out of their account ASAP whenever they receive a payment. I sure do.
After reflection, I decided to still offer PayPal in my auction listings, but only as a draw to pull in the "PayPal Only" bidders. I don't even mention PayPal in my EOAs. I suggest ExchangePath and PayDirect in that order. And the vast majority of my customers just sign up and pay with one of them.
I don't mind the fees. They are very reasonable. It's the lack of candor on PayPal's part that has caused such a deep-seated mis-trust. But instead of doing whatever they can to try to regain the trust they lost, PayPal keeps digging itself deeper into the hole.
I can tell you that if my experience is typical, a lot of customers are moving to other services, especially ExchangePath and PayDirect. All it takes is a little prompting from the sellers along with ExchangePath's $10 sign-up bonus to get a PayPal customer to switch. I have found this out first-hand. And once the momentum starts to swing, it can be hard to stop.
I still like the service that PayPal offers, at the price that I pay for my business account. But until the smoke and mirrors go away I will be promoting the competition big-time.
posted on October 5, 2000 03:48:34 PM new
The real reason(s) Paypal is using verification to obtain permission to make withdrawals from uses' bank accounts:
(1) Paypal wants to push users to fund their Paypal accounts from their bank accounts, rather than credit cards, thereby saving Paypal the 1.5% credit card processing fee. (But they still charge the recipient of the funds 1.9% if they are business/premier.)
If you look at the new policies, this is the major connecting thread between them. Once a user verifies, the default for funding their Paypal account is set to checking account rather than charge card. That's why they want the authorization to withdraw funds from users' bank accounts, not toprove identity.
(2) They can change their TOS at any time to authorize themselves to initiate withdrawals (for chargebacks, etc.) from users' bank accounts. Their promise to never take money from your bank account without your specific authorization is about as reliable as their promise to provide free services.
Number (1) is certainly true, based on their current pattern of behavior. Number (2) is speculative; whether to believe it depends on how far you trust them?
posted on October 5, 2000 03:59:24 PM new
Hi booksbooksbooks,
This is a federally regulated item and this could not happen.
(2) They can change their TOS at any time to authorize themselves to initiate withdrawals (for chargebacks, etc.) from users' bank accounts. Their promise to never take money from your bank account without your specific authorization is about as reliable as their promise to provide free services.
This is a federally regulated item and this could not happen.
(2) They can change their TOS at any time to authorize themselves to initiate withdrawals (for chargebacks, etc.) from users' bank accounts. Their promise to never take money from your bank account without your specific authorization is about as reliable as their promise to provide free services.
Kate
No Damon - this is a federally regulated item and Paypal has done it. Repeatedly - they just pretended that it was the customer's fault that he or she misinterpreted PayPal's screen and hoped that the customer would just let it go.
If Paypal honestly wanted the customer to not remove money until the customer wanted to, then they wouldn't have to put such obvious and overwhelming pressure on them to give them permission to set it up so that the customer could with a single click accidently use checking instead of credit cards, not to mention lying about whether it was nescessary to have it to protect the customer.
This is not an honest system set up for the customer's convienence.
This is a system set up to gouge sellers who think they are getting a deal on credit card payments when they are really paying outrageously high rates for what is essentially ATM purchases.
Credit card rates are no bargain when it's not credit card transactions that you are doing.
posted on October 5, 2000 06:45:38 PM new
I'm with you KateArtist. I don't think most users are aware that this is even going to happen. Heck, a lot of people I know locally that sell on Ebay don't even glance at the boards. I don't know how we can get the word out.
posted on October 5, 2000 06:53:54 PM new
There are two threads (one here and one 7-pager at OTWA) about PayPal taking money back out of people's checking accounts. The OTWA case allegedly involves a $1,000 deposit reversal and another $3,000 frozen in a PayPal account.
they sure don't seem to act in any way that makes me think they care about customer LOYALTY! -Rosalinda