Bye bye Standard Protection, hello compulsory Paypal?

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eBay have doubled the amount guaranteed to be refunded to Paypal buyers in the event of non-delivery or receipt of damaged goods to up to US$2000 for qualified sellers, and to US$200 or CA$315 across the board.

Well this looks nice. More protection for buyers means more confidence in the eBay marketplace, which has to be good news for everyone, buyer and seller alike. Doesn’t it?

Not quite. Many eBayers, myself included, have speculated that eBay would like to force all transactions to be concluded through Paypal, and this is just one more move towards that goal, as the Standard Purchase Protection Program is being discontinued in the US and Canada. This program protected buyers who paid with non-Paypal methods such as cheques and money orders against non-receipt of their item. eBay say:

From a risk management and fraud prevention perspective, SPPP is flawed, because it offers coverage on the riskiest payment methods. This is clearly not in the best interests of the marketplace long-term.

In other words, choose to pay by a method that we don’t control, where we don’t take another cut of the cash and where we can’t reclaim chargebacks from errant sellers like we do with Paypal… and you’re on your own.

Obviously eBay don’t like exposing themselves to risk. So why are they so ready to let their sellers do it? With this increase in buyer protection, sellers are left to bear even more of the risk of fraudulent chargebacks by scamming buyers. Until eBay make it possible for sellers to control the level of risk they will accept – by, for example, being able to block bidders without verified Paypal accounts and confirmed addresses – sellers remain completely over-exposed by these measures.

One Response

  1. This might cause me to want to remove paypal as an option. I already have repeat customers who are fine with mailing me a check, money order and even better Western Union. I am just so not into contributing to a big fat greedy machine who create problems just to sell their brand. We wouldn’t have so many crooks on ebay if they just screened people better. Ebay likes to create this dependency by letting ebayers be victimized. Bullies!


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