6 ms·

Curious about that too. Recently we have some great alternatives like Stripe (https://stripe.com https://stripe.com ).

alapshah 15y ago
I asked them about this - they don't handle marketplace businesses (Taking money on behalf of another customer), for the same regulatory issues previously stated. PoundPay (also YC) is trying to solve this issue but I haven't heard a peep out of them... Also it is quite annoying because I paid for a zaarly and it showed poundpay on my statement, I had no idea what it was.
- cwilson 15y ago
  PoundPay is super interesting, because from what I can see, only Amazon has a solution that essentially handles escrow transactions (which is what KickStarter uses). You're right however, I haven't heard much from them lately (as opposed to Stripe, who seems to be killing it). There was also a limitation with PoundPay of being US only, which is not an option for many companies.
  - zende 15y ago
    US merchants, international buyers -- just like Amazon (FPS) and Etsy's current systems. Which countries would you be most interested in us adding?
  - jjb123 15y ago
    Stripe's model depends on marketing and press, PoundPay has gotten really good word of mouth by the companies that currently use it (for our startup we've looked at our own processing, paypal, amazon, and just about all the options)
- pbreit 15y ago
  Etsy could have implemented Stripe and not be the middleman while still offering a "direct pay-like" experience. Of course, each Etsy seller would need to sign up for Stripe. But I would think Stripe would be very keen on that.
  - ozten 15y ago
    Did anyone at Etsy look into this integration? Why didn't this seem viable?
    - subpixel 15y ago
      That approach would remove a couple big wins: 1) the ability to sell Etsy-wide credit, e.g. gift certificates. 2) interest-earning cash in the bank (the days/weeks between the sale and when the seller marks the item as shipped)
- zende 15y ago
  it now says ZAARLY.COM on your statement for Zaarly. This was a previous bank limitation, not technical or design, that has been resolved. new business comes in through referrals and press by our marketplaces, so we haven't focused on press. if you want to sign up as a marketplace: https://www.poundpay.com/developers/application https://www.poundpay.com/developers/application
otakucode 15y ago
Great alternative? "Pricing like it should be! 2.9%..." I stopped right there. It does not cost more to process larger numbers. There is no rational justification whatsoever for any money-handling service to charge a percentage. Period. No amount of 'but the other guys are bigger assholes than me!' will cover up the fact that the banking environment right now is set up to make it as difficult as possible for anyone but extremely large businesses to do a large volume of transactions without making it outright illegal. I want to see a payment processor that charges a low, flat rate for processing transactions, with their charges based upon the actual cost incurred by their processing plus a bit of profit. They are providing a useful service, I'm not against making money. But taking a percentage when the size of the transaction does ABSOLUTELY NOTHING to your costs of processing is like taking your dick out in public and asking children to pet it.
- tonyarkles 15y ago
  Given that they're accepting credit cards, Etsy's "cost of processing" does actually increase as the size of the transaction increases (the merchant account will usually have a 2-3% transaction cost associated with it). Likely, the alternative one-size-fits-all transaction fee would end up making the low end of transactions ridiculous; a $1 painted popsicle stick with a $3 payment cost. Doing it by percentage more accurately reflects the model that Etsy has to pay.
  - otakucode 15y ago
    Yes, I was not speaking in terms of Etsy, but in terms of Stripe. For Etsy, yes, their cost does definitely increase as transaction cost gets larger, but only because the payment processor they are forced to use (there are no other options) charges a percentage of each transaction. It is on the payment processors side where there is no justification for taking a larger chunk simply because a number is larger. One of the advantages of digital systems is that per-transaction costs bottom out very quickly. Even if you are doing something complex (which payment processing is not), the actual cost is usually so small as to be very difficult to measure. I work in an environment which, by law, HAS to measure their per-transaction costs in minute detail. They quantify through statistical analysis the mean amount of CPU time, the mean amount of human-intervention time necessary, the amortized cost of support contracts affecting the software and hardware, power usage by the equipment, EVERYTHING. And they are doing something which is many orders of magnitude more complex than payment processing. And the result is that per-transaction the cost is almost negligible. The same service would have cost hundreds or thousands of dollars and taken weeks 20 years ago. Today, there's a guaranteed response time of under 30 seconds for most transactions and they cost less than $10 (with almost all of that price made up of the small fraction of transactions which do require human intervention). These exact same cost-reduction effects of hardware and software growth have affected banking heavily. But none of those advances have resulted in lowered fees, in fact processing costs and transaction fees have only gone up. I think that it is great that Etsy is moving to accept credit cards directly. Personally I believe the future of our economy (and this might be a 50-year or longer dream mind you) will be moving away from centralized organizations entirely. The benefits companies offered (aggregation of workers geographically, management of distribution chains, aggregation of work itself geographically) no longer exist. The purpose they served can be filled by modern communication technologies and software. For that to even have a chance of happening, however, requires a couple things. Internet access needs to be defined as a public utility or some other steps taken to severely restrict the ability of ISPs to charge higher rates to users which make money via their Internet connection, and payment processing has to evolve to the point where an individual person can accept payment from anywhere for as close to zero cost as possible. If either of those things do not happen, the companies providing the infrastructure service will choke to death any individuals trying to make their living via the Internet. Over the past 30-40 years, thanks to computers and automation technologies, the productivity of a single person has absolutely exploded. The profit most companies make on a per-employee basis is astronomical compared to rates at any other point in history. When that is widely realized, and people recognize that instead of making $35k/yr for an employer they can make $350k/yr as an independent worker (a conservative estimate, it is very difficult to overestimate just how much money is wasted oiling the supremely inefficient machine that is the modern corporation) while working far reduced hours, the need for that infrastructure will be strong.

I asked them about this - they don't handle marketplace businesses (Taking money on behalf of another customer), for the same regulatory issues previously stated. PoundPay (also YC) is trying to solve this issue but I haven't heard a peep out of them... Also it is quite annoying because I paid for a zaarly and it showed poundpay on my statement, I had no idea what it was.

cwilson 15y ago
PoundPay is super interesting, because from what I can see, only Amazon has a solution that essentially handles escrow transactions (which is what KickStarter uses). You're right however, I haven't heard much from them lately (as opposed to Stripe, who seems to be killing it). There was also a limitation with PoundPay of being US only, which is not an option for many companies.
- zende 15y ago
  US merchants, international buyers -- just like Amazon (FPS) and Etsy's current systems. Which countries would you be most interested in us adding?
- jjb123 15y ago
  Stripe's model depends on marketing and press, PoundPay has gotten really good word of mouth by the companies that currently use it (for our startup we've looked at our own processing, paypal, amazon, and just about all the options)
pbreit 15y ago
Etsy could have implemented Stripe and not be the middleman while still offering a "direct pay-like" experience. Of course, each Etsy seller would need to sign up for Stripe. But I would think Stripe would be very keen on that.
- ozten 15y ago
  Did anyone at Etsy look into this integration? Why didn't this seem viable?
  - subpixel 15y ago
    That approach would remove a couple big wins: 1) the ability to sell Etsy-wide credit, e.g. gift certificates. 2) interest-earning cash in the bank (the days/weeks between the sale and when the seller marks the item as shipped)
zende 15y ago
it now says ZAARLY.COM on your statement for Zaarly. This was a previous bank limitation, not technical or design, that has been resolved. new business comes in through referrals and press by our marketplaces, so we haven't focused on press. if you want to sign up as a marketplace: https://www.poundpay.com/developers/application https://www.poundpay.com/developers/application

otakucode 15y ago

Great alternative? "Pricing like it should be! 2.9%..." I stopped right there. It does not cost more to process larger numbers. There is no rational justification whatsoever for any money-handling service to charge a percentage. Period. No amount of 'but the other guys are bigger assholes than me!' will cover up the fact that the banking environment right now is set up to make it as difficult as possible for anyone but extremely large businesses to do a large volume of transactions without making it outright illegal. I want to see a payment processor that charges a low, flat rate for processing transactions, with their charges based upon the actual cost incurred by their processing plus a bit of profit. They are providing a useful service, I'm not against making money. But taking a percentage when the size of the transaction does ABSOLUTELY NOTHING to your costs of processing is like taking your dick out in public and asking children to pet it.

tonyarkles 15y ago
Given that they're accepting credit cards, Etsy's "cost of processing" does actually increase as the size of the transaction increases (the merchant account will usually have a 2-3% transaction cost associated with it). Likely, the alternative one-size-fits-all transaction fee would end up making the low end of transactions ridiculous; a $1 painted popsicle stick with a $3 payment cost. Doing it by percentage more accurately reflects the model that Etsy has to pay.
- otakucode 15y ago
  Yes, I was not speaking in terms of Etsy, but in terms of Stripe. For Etsy, yes, their cost does definitely increase as transaction cost gets larger, but only because the payment processor they are forced to use (there are no other options) charges a percentage of each transaction. It is on the payment processors side where there is no justification for taking a larger chunk simply because a number is larger. One of the advantages of digital systems is that per-transaction costs bottom out very quickly. Even if you are doing something complex (which payment processing is not), the actual cost is usually so small as to be very difficult to measure. I work in an environment which, by law, HAS to measure their per-transaction costs in minute detail. They quantify through statistical analysis the mean amount of CPU time, the mean amount of human-intervention time necessary, the amortized cost of support contracts affecting the software and hardware, power usage by the equipment, EVERYTHING. And they are doing something which is many orders of magnitude more complex than payment processing. And the result is that per-transaction the cost is almost negligible. The same service would have cost hundreds or thousands of dollars and taken weeks 20 years ago. Today, there's a guaranteed response time of under 30 seconds for most transactions and they cost less than $10 (with almost all of that price made up of the small fraction of transactions which do require human intervention). These exact same cost-reduction effects of hardware and software growth have affected banking heavily. But none of those advances have resulted in lowered fees, in fact processing costs and transaction fees have only gone up. I think that it is great that Etsy is moving to accept credit cards directly. Personally I believe the future of our economy (and this might be a 50-year or longer dream mind you) will be moving away from centralized organizations entirely. The benefits companies offered (aggregation of workers geographically, management of distribution chains, aggregation of work itself geographically) no longer exist. The purpose they served can be filled by modern communication technologies and software. For that to even have a chance of happening, however, requires a couple things. Internet access needs to be defined as a public utility or some other steps taken to severely restrict the ability of ISPs to charge higher rates to users which make money via their Internet connection, and payment processing has to evolve to the point where an individual person can accept payment from anywhere for as close to zero cost as possible. If either of those things do not happen, the companies providing the infrastructure service will choke to death any individuals trying to make their living via the Internet. Over the past 30-40 years, thanks to computers and automation technologies, the productivity of a single person has absolutely exploded. The profit most companies make on a per-employee basis is astronomical compared to rates at any other point in history. When that is widely realized, and people recognize that instead of making $35k/yr for an employer they can make $350k/yr as an independent worker (a conservative estimate, it is very difficult to overestimate just how much money is wasted oiling the supremely inefficient machine that is the modern corporation) while working far reduced hours, the need for that infrastructure will be strong.