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I'm actually surprised that businesses till use PayPal after all the incidents like this. They've made it incredibly clear that their policies and actions are

I'm actually surprised that businesses till use PayPal after all the incidents like this. They've made it incredibly clear that their policies and actions are arbitrary and they don't care about their customers at all. And yet, companies still use them. I can understand customers using them... The customer almost never gets screwed, that I've seen... But anyone with a balance is taking a risk that it'll be seized. And if they feel like it, you won't get the money back. Google and Amazon now both offer excellent payment systems and I've never heard these horror stories about them. So why don't people switch?

pfchangs 15y ago
Merchants don't use google or amazon(or any other payment system) because they require a higher amount of reserve and/or fees. The loud complaints are from people who want their cake and eat it for free. People don't realize nothing is free.
- codenerdz 15y ago
  The problem here is that people are generally unaware of a potential 6 months lockdown if paypal raises a red flag on your account. Furthermore the reasons for red flags are also unpredictable(Im assuming that paypal doesnt want its fraud detection scheme gamed). The biggest problem is a difficulty/impossibility of a resolution process other than waiting for 6 months to get your funds. I would definitely try to get somebody on the phone and escalate the problem as contacting email support will get you into an infinite ping pong of templated answers.
  - dangrossman 15y ago
    The reasons are perfectly predictable. PayPal's risk department acts like any other merchant processor's risk department. The things that trigger a review are... * >1% monthly volume chargeback rate * >1% monthly volume refund rate * too many payment disputes * violating the terms of service (including what types of products may not be sold through PayPal) * selling products or services with known high chargeback rates * a sudden increase in processing volume * a sale an order of magnitude larger than your average ticket * accepting payment too far in advance of shipping a product or providing a service I'm sure there's also some program in there looking at interactions between accounts to find strange patterns, but that's not usually what trips people up unless they're actually laundering money or factoring. It's always the obvious stuff.
Anechoic 15y ago
> Google and Amazon now both offer excellent payment systems and I've never heard these horror stories about them. So why don't people switch? I'll give the same answer I give whenever this question comes up - I stick with PayPal because of the instant access to the money from transactions via the PayPal debit card. Since I sell physical products, this gives me a lot of flexibility in terms re-ordering inventory, moreso than the "deposit to your account once per week/in a couple of business days" policies of other options. That said, I'm no fool; I sweep my money out of PayPal ASAP and I have an Amazon Payments account ready to go in the event PayPal screws with my account, but as long as things are working with PayPal, I'm going to stay with PayPal (until something better comes along).
- chops 15y ago
  until something better comes along Like http://www.swipe.com http://www.swipe.com ?
  - edcrfv 15y ago
    I think you mean https://stripe.com/ https://stripe.com/ ?
  - Anechoic 15y ago
    (presuming you meant https://stripe.com https://stripe.com) Do they offer instant access to transactional cash? Also this look s like programmer-type offering (I'm not a programmer). Do they offer a bit of HTML I can drop into my website to process the transaction?
    - chops 15y ago
      (presuming you meant https://stripe.com)* https://stripe.com)* Heh, yep. Total brain fart. I'm not sure about the HTML stuff, but I thought that they do have a js drop-in that should require minimal coding. Don't quote me on that, but at the very least, it's not as nasty as Paypal seems to be.
  - mahyarm 15y ago
cperciva 15y ago
I'll support Google Checkout and Amazon Payments as soon as they support Canadian merchants.
sek 15y ago
Google doesn't offer direct debit here in Germany for example. Credit cards are not so common here, but every 12 year old with a bank account can use direct debit. There is a big chunk of money lost if Germans are not able to pay with Google Checkout and i assume there are similar problems elsewhere. For consumers PayPal has a easy verification process and from that point on it works everywhere instantly. I also see a lot of advertising from PayPal, so the regular people trust them i think. They know what they are doing, they put more effort behind it than other ones. Google has a marketing budget for Chrome and look how well it does. I never heard from Amazon payments, so the same situation here. They both could do more if they want to be a real competitor.
dangrossman 15y ago
> They've made it incredibly clear that their policies and actions are arbitrary and they don't care about their customers at all. It seems to me that they're incredibly consistent and care about their customers exactly as much as any other merchant account provider. This exact story with a game developer taking preorders then having PayPal problems has played out a half dozen times on Hacker News alone; in reality it happens regularly. It would happen if these developers applied for a merchant account and said they were taking long-term preorders on the application too. The only problem with PayPal is that merchants don't expect PayPal to act like every other processor, and have no experience dealing with the risk/underwriting departments of banks to realize that what they're doing would be a problem anywhere. As far as why businesses still use PayPal? Nobody else operates in as many countries. Nobody else has over 200 million members already signed up and trusting the payment process. Few MOTO merchant accounts actually beat the fees PayPal charges, especially once you have >$10,000/mo in volume, when you actually add up all the transaction fees. And few gateways are as easy to implement or built into as many other ecommerce products. It makes no sense from a business standpoint not to use PayPal (which in 2011 does not mean sending someone to paypal.com to pay if they want to pay on site). They're cheaperc, more reliable, allow you to accept all major credit and debit cards, bank transfers, eChecks, payments from 200+ million members' balances, and pay you your funds immediately. If you're that worried about having a problem, have a backup in place to switch to and don't hold a PayPal balance -- risk free. You would think the HN community would look at PayPal and see a success story to be shared and celebrated. They were the only significant 3rd party payment processor to make it through the dot com bubble. There have been many attempts. They all went out of business due to fraud. PayPal was bleeding over $10 million a month to chargebacks and fraud at one point. They created the software and systems to make a global 3rd party payment platform possible and survived. Now they make possible an enormous amount of ecommerce for tens of millions of people that would not be able to accept payments any other way. Instead we see the occasional "horror story" that would likely happen whether the developer was using PayPal or anyone else, and a PayPal Sucks website that's accumulated barely 2000 threads in over a decade (what fraction of a fraction of a percent of PayPal users is that?), and certain vocal people pile on the "why would anyone ever use PayPal" bandwagon...
- InclinedPlane 15y ago
mgkimsal 15y ago
Google's "checkout" is so-so, but they don't treat it like a real service for merchants (well, imo). Every time I log in to google.com/checkout, I have to go click a stupid little logo in the upper right that's not labelled as anything except a gear, then choose 'my sales' to see my sales. It always treats me as a consumer first, and merchant second. Secondly, even though I've told google checkout explicitly that I sell digital goods, it constantly shows "not yet shipped" on every single one of my orders. I'm explicitly setting "digital-content" flags on the request, but it's seemingly ignored. Thirdly, Google Checkout routinely - as in >50% of the time in my experience - holds payments for 15 minutes for 'fraud check'. In my case, I'm delivering digital goods, but I'm not going to tell people to wait for 15 minutes, so I have to trust that the request will go through. I get a few problems per month with that, but there's no setting in google checkout to say "please don't take 15 minutes to process payments". For people doing physical goods sales, it's probably OK. It's far from perfect for digital sales.
- simcop2387 15y ago
  Depending on your digital goods, have you thought about sending a link in email, as part of a receipt even? Could easily setup a mail server to forge the time back 15 minutes and make it look like it was instant and just not send it if it was fraudulent. It's a little sleazy but it'd at least give a completely different impression than, "Please wait 15 minutes".
  - mgkimsal 15y ago
    People just don't want to wait that time at all. The actual impact on user's hasn't been too bad (because I'm taking the risk), but the actual flow, from my perspective, has been pretty poor, and from what I can tell it's not documented that they'll hold transactions for 15 minutes.

pfchangs 15y ago

Merchants don't use google or amazon(or any other payment system) because they require a higher amount of reserve and/or fees. The loud complaints are from people who want their cake and eat it for free. People don't realize nothing is free.

codenerdz 15y ago
The problem here is that people are generally unaware of a potential 6 months lockdown if paypal raises a red flag on your account. Furthermore the reasons for red flags are also unpredictable(Im assuming that paypal doesnt want its fraud detection scheme gamed). The biggest problem is a difficulty/impossibility of a resolution process other than waiting for 6 months to get your funds. I would definitely try to get somebody on the phone and escalate the problem as contacting email support will get you into an infinite ping pong of templated answers.
- dangrossman 15y ago
  The reasons are perfectly predictable. PayPal's risk department acts like any other merchant processor's risk department. The things that trigger a review are... * >1% monthly volume chargeback rate * >1% monthly volume refund rate * too many payment disputes * violating the terms of service (including what types of products may not be sold through PayPal) * selling products or services with known high chargeback rates * a sudden increase in processing volume * a sale an order of magnitude larger than your average ticket * accepting payment too far in advance of shipping a product or providing a service I'm sure there's also some program in there looking at interactions between accounts to find strange patterns, but that's not usually what trips people up unless they're actually laundering money or factoring. It's always the obvious stuff.

Anechoic 15y ago

> Google and Amazon now both offer excellent payment systems and I've never heard these horror stories about them. So why don't people switch? I'll give the same answer I give whenever this question comes up - I stick with PayPal because of the instant access to the money from transactions via the PayPal debit card. Since I sell physical products, this gives me a lot of flexibility in terms re-ordering inventory, moreso than the "deposit to your account once per week/in a couple of business days" policies of other options. That said, I'm no fool; I sweep my money out of PayPal ASAP and I have an Amazon Payments account ready to go in the event PayPal screws with my account, but as long as things are working with PayPal, I'm going to stay with PayPal (until something better comes along).

chops 15y ago
until something better comes along Like http://www.swipe.com http://www.swipe.com ?
- edcrfv 15y ago
  I think you mean https://stripe.com/ https://stripe.com/ ?
- Anechoic 15y ago
  (presuming you meant https://stripe.com https://stripe.com) Do they offer instant access to transactional cash? Also this look s like programmer-type offering (I'm not a programmer). Do they offer a bit of HTML I can drop into my website to process the transaction?
  - chops 15y ago
    (presuming you meant https://stripe.com)* https://stripe.com)* Heh, yep. Total brain fart. I'm not sure about the HTML stuff, but I thought that they do have a js drop-in that should require minimal coding. Don't quote me on that, but at the very least, it's not as nasty as Paypal seems to be.
- mahyarm 15y ago

cperciva 15y ago

I'll support Google Checkout and Amazon Payments as soon as they support Canadian merchants.

sek 15y ago

Google doesn't offer direct debit here in Germany for example. Credit cards are not so common here, but every 12 year old with a bank account can use direct debit. There is a big chunk of money lost if Germans are not able to pay with Google Checkout and i assume there are similar problems elsewhere. For consumers PayPal has a easy verification process and from that point on it works everywhere instantly. I also see a lot of advertising from PayPal, so the regular people trust them i think. They know what they are doing, they put more effort behind it than other ones. Google has a marketing budget for Chrome and look how well it does. I never heard from Amazon payments, so the same situation here. They both could do more if they want to be a real competitor.

dangrossman 15y ago

> They've made it incredibly clear that their policies and actions are arbitrary and they don't care about their customers at all. It seems to me that they're incredibly consistent and care about their customers exactly as much as any other merchant account provider. This exact story with a game developer taking preorders then having PayPal problems has played out a half dozen times on Hacker News alone; in reality it happens regularly. It would happen if these developers applied for a merchant account and said they were taking long-term preorders on the application too. The only problem with PayPal is that merchants don't expect PayPal to act like every other processor, and have no experience dealing with the risk/underwriting departments of banks to realize that what they're doing would be a problem anywhere. As far as why businesses still use PayPal? Nobody else operates in as many countries. Nobody else has over 200 million members already signed up and trusting the payment process. Few MOTO merchant accounts actually beat the fees PayPal charges, especially once you have >$10,000/mo in volume, when you actually add up all the transaction fees. And few gateways are as easy to implement or built into as many other ecommerce products. It makes no sense from a business standpoint not to use PayPal (which in 2011 does not mean sending someone to paypal.com to pay if they want to pay on site). They're cheaperc, more reliable, allow you to accept all major credit and debit cards, bank transfers, eChecks, payments from 200+ million members' balances, and pay you your funds immediately. If you're that worried about having a problem, have a backup in place to switch to and don't hold a PayPal balance -- risk free. You would think the HN community would look at PayPal and see a success story to be shared and celebrated. They were the only significant 3rd party payment processor to make it through the dot com bubble. There have been many attempts. They all went out of business due to fraud. PayPal was bleeding over $10 million a month to chargebacks and fraud at one point. They created the software and systems to make a global 3rd party payment platform possible and survived. Now they make possible an enormous amount of ecommerce for tens of millions of people that would not be able to accept payments any other way. Instead we see the occasional "horror story" that would likely happen whether the developer was using PayPal or anyone else, and a PayPal Sucks website that's accumulated barely 2000 threads in over a decade (what fraction of a fraction of a percent of PayPal users is that?), and certain vocal people pile on the "why would anyone ever use PayPal" bandwagon...

InclinedPlane 15y ago

mgkimsal 15y ago

Google's "checkout" is so-so, but they don't treat it like a real service for merchants (well, imo). Every time I log in to google.com/checkout, I have to go click a stupid little logo in the upper right that's not labelled as anything except a gear, then choose 'my sales' to see my sales. It always treats me as a consumer first, and merchant second. Secondly, even though I've told google checkout explicitly that I sell digital goods, it constantly shows "not yet shipped" on every single one of my orders. I'm explicitly setting "digital-content" flags on the request, but it's seemingly ignored. Thirdly, Google Checkout routinely - as in >50% of the time in my experience - holds payments for 15 minutes for 'fraud check'. In my case, I'm delivering digital goods, but I'm not going to tell people to wait for 15 minutes, so I have to trust that the request will go through. I get a few problems per month with that, but there's no setting in google checkout to say "please don't take 15 minutes to process payments". For people doing physical goods sales, it's probably OK. It's far from perfect for digital sales.

simcop2387 15y ago
Depending on your digital goods, have you thought about sending a link in email, as part of a receipt even? Could easily setup a mail server to forge the time back 15 minutes and make it look like it was instant and just not send it if it was fraudulent. It's a little sleazy but it'd at least give a completely different impression than, "Please wait 15 minutes".
- mgkimsal 15y ago
  People just don't want to wait that time at all. The actual impact on user's hasn't been too bad (because I'm taking the risk), but the actual flow, from my perspective, has been pretty poor, and from what I can tell it's not documented that they'll hold transactions for 15 minutes.