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Based on my experience as a developer and user I can't understand how PayPal got so big and ubiquitous. I had the worst experience ever in trying to set up our

by ghego1 6y ago

Based on my experience as a developer and user I can't understand how PayPal got so big and ubiquitous. I had the worst experience ever in trying to set up our recurring billing system with them, wasting several days of work, to the point that I simply gave up, switched to Stripe, and got everything up and running, in production, in hours. Even as a consumer I had a terrible experience when trying to send money abroad, for my rent, with Xoom, a PayPal service. They initially took the money from my PayPal account, told me that the money was on its way to the recipient, only to block it some days later for non specified reasons (refunded in my account). On top of that, I lost the option to use my PayPal account to send money, for what appeared to be a technical issue. Even if the system appeared to give me the option to use my PayPal account as a source of funds, telling me that the accounts were indeed connected, then when actually sending the money the option disappeared. To solve the issue I called Xoom, they told me that there was no way of reconnecting my account and that I had to contact PayPal. So I did and they told me that they couldn't do anything and that I had to contact Xoom. After few exchanges back and forth like these, I simply asked to close my Xoom account so I could open a new one and restore the link between my Xoom and PayPal accounts, but they told me that that was not possible and that to cancel Xoom I had to cancel also PayPal. So I gave up, used another service and got my money to my recipient.

afiori 6y ago
I'm not from the US and to me PayPal was always only a way to avoid filling in credit cards details on (random) websites. it always feels a bit weird to see people elsewhere rely on it for much more.
- aphextron 6y ago
  >I'm not from the US and to me PayPal was always only a way to avoid filling in credit cards details on (random) websites. And this is the answer. Paypal's existence comes down to the fact that they are the sole "legitimate" vector into the US financial system for a vast majority of the rest of the world. Because that's such a massive financial incentive, they can basically treat users however they wish and get away with it.
  - newyorker2 6y ago
    Brewing up space for that next startup who respects their users and works in the same marketplace ;)
Mistri 6y ago
Perhaps part of the reason was the ease of access for minors. I'm now over 18, but when PayPal got popular, my friends and I were under 18 so we weren't allowed to purchase stuff (like video games) online since we didn't have our own credit/debit cards. PayPal used to not verify your age so it was perfect for this type of stuff.
- lotsofpulp 6y ago
  PayPal was the first free electronic way to send and receive money to people in the US, to my knowledge. Which is a sad indictment of the US’s infrastructure. Even today, so many people use Venmo, which is still PayPal. Apple Cash seems to work well, but still involves an unnecessary middleman like PayPal. Zelle is the only half decent solution, that doesn’t involves third parties.
  - eru 6y ago
    > PayPal was the first free electronic way [...] What do you mean by 'free'? Didn't they always charge fees?
    - stevewodil 6y ago
      Not for sending money to friends - fees are charged when paying for goods & services
  - the_pwner224 6y ago
    Zelle is also a third party, just well integrated into the banks' UIs. I had a Zelle payment blocked recently and ended up seeing a lot of stuff on the internet / reddit about Zelle doing similar stuff as the other companies when it comes to blocking payments as well as customer service & having money disappear in some cases.
    - lotsofpulp 6y ago
      Zelle is the brand name for Early Warning Services, which used to be called clearXchange, and is owned by the biggest banks themselves. When I write there is no middleman or third party, I mean that the money goes from the sender's account to the recipient's account. With PayPal/Venmo/Apple Cash/etc, the money goes from the sender's account, to Paypal/Venmo/Apple/etc's account, and then to the recipient. Also, with Zelle, you never need to give anyone your bank account number, and you are never authorizing anyone to reach into your account and take money via ACH, like you are with Paypal/Venmo/Apple Cash/etc. It’s also instant. https://www.earlywarning.com/about https://www.earlywarning.com/about >Early Warning Services, LLC, is a fintech company owned by seven of the country’s largest banks. https://en.wikipedia.org/wiki/Zelle_(payment_service) https://en.wikipedia.org/wiki/Zelle_(payment_service) >Zelle is a United States–based digital payments network owned by Early Warning Services, a private financial services company owned by the banks Bank of America, BB&T, Capital One, JPMorgan Chase, PNC Bank, U.S. Bank and Wells Fargo.[1][2][3] The Zelle service enables individuals to electronically transfer money from their bank account to another registered user's bank account (within the United States) using a mobile device or the website of a participating banking institution.[1][3]
nelaboras 6y ago
PayPal used to be great in its time. Leadership and ownership changed and now its just there and because everyone knows and trusts it it still lives on. Scale/brand effects.
- M2Ys4U 6y ago
  PayPal has always sucked, at least to some level. For example: paypalsucks.com was set up some time around 2001[0]. [0] This is the earliest snapshot the IA has of the site: https://web.archive.org/web/20010215013627/http://paypalsucks.com:80/ https://web.archive.org/web/20010215013627/http://paypalsuck...
JanisL 6y ago
Part of why PayPal got big is that at the time it was new the incumbent banks had transactions that tended to be slow and crappy and sometimes expensive on top of that. I remember when I was younger that there was this "mysterious" clearing time with my bank where you'd send money and the other party wouldn't get it for a number of days (and that number of days wasn't even reliable either). And with international transfers it was worse than the domestic ones. Now that people have got used to better payment processing the banks have had to improve, I think it's easy to forget just how bad things used to be.
tgsovlerkhgsel 6y ago
Ebay pushed it aggressively; IIRC you effectively couldn't use ebay (or lost critical aspects like fraud protection) if you didn't use PayPal. Outside of the US, credit cards were far from ubiquitous (and they still aren't). PayPal was the one system that could handle international transfers reasonably. Edit: Also, speed and payments to individuals. Back when eBay was an auction house for used goods sold by individuals, not a marketplace for commercial sellers, it was the one way to get someone money that was instant. No idea how that worked in the US, but in Germany the alternative was bank transfers which took 2-3 days back then.
anigbrowl 6y ago
Very simple: they were the first to get there in the online payments space and delivered something that worked reliably without the time and $ cost of money orders or bank transfers.

by ghego1 6y ago

afiori 6y ago

I'm not from the US and to me PayPal was always only a way to avoid filling in credit cards details on (random) websites. it always feels a bit weird to see people elsewhere rely on it for much more.

aphextron 6y ago
>I'm not from the US and to me PayPal was always only a way to avoid filling in credit cards details on (random) websites. And this is the answer. Paypal's existence comes down to the fact that they are the sole "legitimate" vector into the US financial system for a vast majority of the rest of the world. Because that's such a massive financial incentive, they can basically treat users however they wish and get away with it.
- newyorker2 6y ago
  Brewing up space for that next startup who respects their users and works in the same marketplace ;)

Mistri 6y ago

Perhaps part of the reason was the ease of access for minors. I'm now over 18, but when PayPal got popular, my friends and I were under 18 so we weren't allowed to purchase stuff (like video games) online since we didn't have our own credit/debit cards. PayPal used to not verify your age so it was perfect for this type of stuff.

lotsofpulp 6y ago
PayPal was the first free electronic way to send and receive money to people in the US, to my knowledge. Which is a sad indictment of the US’s infrastructure. Even today, so many people use Venmo, which is still PayPal. Apple Cash seems to work well, but still involves an unnecessary middleman like PayPal. Zelle is the only half decent solution, that doesn’t involves third parties.
- eru 6y ago
  > PayPal was the first free electronic way [...] What do you mean by 'free'? Didn't they always charge fees?
  - stevewodil 6y ago
    Not for sending money to friends - fees are charged when paying for goods & services
- the_pwner224 6y ago
  Zelle is also a third party, just well integrated into the banks' UIs. I had a Zelle payment blocked recently and ended up seeing a lot of stuff on the internet / reddit about Zelle doing similar stuff as the other companies when it comes to blocking payments as well as customer service & having money disappear in some cases.
  - lotsofpulp 6y ago
    Zelle is the brand name for Early Warning Services, which used to be called clearXchange, and is owned by the biggest banks themselves. When I write there is no middleman or third party, I mean that the money goes from the sender's account to the recipient's account. With PayPal/Venmo/Apple Cash/etc, the money goes from the sender's account, to Paypal/Venmo/Apple/etc's account, and then to the recipient. Also, with Zelle, you never need to give anyone your bank account number, and you are never authorizing anyone to reach into your account and take money via ACH, like you are with Paypal/Venmo/Apple Cash/etc. It’s also instant. https://www.earlywarning.com/about https://www.earlywarning.com/about >Early Warning Services, LLC, is a fintech company owned by seven of the country’s largest banks. https://en.wikipedia.org/wiki/Zelle_(payment_service) https://en.wikipedia.org/wiki/Zelle_(payment_service) >Zelle is a United States–based digital payments network owned by Early Warning Services, a private financial services company owned by the banks Bank of America, BB&T, Capital One, JPMorgan Chase, PNC Bank, U.S. Bank and Wells Fargo.[1][2][3] The Zelle service enables individuals to electronically transfer money from their bank account to another registered user's bank account (within the United States) using a mobile device or the website of a participating banking institution.[1][3]

nelaboras 6y ago

PayPal used to be great in its time. Leadership and ownership changed and now its just there and because everyone knows and trusts it it still lives on. Scale/brand effects.

M2Ys4U 6y ago
PayPal has always sucked, at least to some level. For example: paypalsucks.com was set up some time around 2001[0]. [0] This is the earliest snapshot the IA has of the site: https://web.archive.org/web/20010215013627/http://paypalsucks.com:80/ https://web.archive.org/web/20010215013627/http://paypalsuck...

JanisL 6y ago

Part of why PayPal got big is that at the time it was new the incumbent banks had transactions that tended to be slow and crappy and sometimes expensive on top of that. I remember when I was younger that there was this "mysterious" clearing time with my bank where you'd send money and the other party wouldn't get it for a number of days (and that number of days wasn't even reliable either). And with international transfers it was worse than the domestic ones. Now that people have got used to better payment processing the banks have had to improve, I think it's easy to forget just how bad things used to be.

tgsovlerkhgsel 6y ago

Ebay pushed it aggressively; IIRC you effectively couldn't use ebay (or lost critical aspects like fraud protection) if you didn't use PayPal. Outside of the US, credit cards were far from ubiquitous (and they still aren't). PayPal was the one system that could handle international transfers reasonably. Edit: Also, speed and payments to individuals. Back when eBay was an auction house for used goods sold by individuals, not a marketplace for commercial sellers, it was the one way to get someone money that was instant. No idea how that worked in the US, but in Germany the alternative was bank transfers which took 2-3 days back then.

anigbrowl 6y ago

Very simple: they were the first to get there in the online payments space and delivered something that worked reliably without the time and $ cost of money orders or bank transfers.