PayPal compulsory in Video Games, Health & Beauty

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eBay have announced today that as of next week, items listed in the Video Games: Consoles category will be allowed to offer PayPal as the single payment option. In addition, sellers listing in Video Games and Health & Beauty must offer PayPal amongst their payment options. The change is “part of our ongoing efforts to reduce fraud and protect buyers and sellers in the eBay community”.

This shouldn’t really come as a surprise to anyone: PS3 presales, for example, were restricted to Paypal payments only. Similarly, new sellers on .com have been required to accept Paypal or hold a credit card merchant account since January. If this development of those policies protects buyers and stems the “I was ripped off on eBay” stories in the press, it’ll be good for sellers too.

And in practice, nothing has changed: PayPal is so popular with buyers these days that you have to accept PayPal if you actually want to sell anything. Some sellers, though, will undoubtedly see this as “the thin end of the wedge”, one more step towards compulsory PayPal. Is this the case? Frankly, I think so. It’s almost inevitable that the ‘must accept PayPal’ policy will be extended to other categories later in the year: my best guess would be DVDs, high-end electronics and toys, which are all high profile in the run up to Christmas. And it wouldn’t surprise me if the policy went site-wide within the next twelve months.

12 Responses

  1. The big question is if PayPal was obligatory for all listings would that actually be a bad thing? If they linked the sign up for an eBay account with compulsory linking with an existing or opening a new PayPal account everyone would have one. Most use PayPal anyway so as you say, no real change.

  2. Most sellers tend to think of compulsory Paypal on everything as a bad thing, Chris, as I’m sure you’re aware :-p If a buyer wants to pay by cheque and a seller wants to accept a cheque, why on earth should eBay stop them? They’re getting their cut of the deal already.

    There’s also the issue that some people are just unable to have a Paypal account: that’s less the case in the UK, but many French “basic” bank accounts won’t apparently work with Paypal, and anyway French commerce laws would make it illegal to have Paypal only on .fr.

  3. ok I’ll concede obligatory for buyers, I don’t care if someone wants to send me a cheque, I just want to be paid. But I don’t think it a bad idea to force all sellers to have a PayPal account and to make it available at least as an option on every listing.

  4. On high value items it’s a bit of a tug of war. Sellers would much rather accept a money order or check for a high value item since there’s no chance of a chargeback, where as buyers don’t want to pay with any method that’s not backed by a credit card.

    “Don’t accept PayPal on an amount you’re not comfortable to lose” is a common mantra in some discussion boards. For buyers it’s “never pay for anything high value without using a credit card type payment”. If both parties stuck to these mantras, nothing would ever get sold!

    While overall it’s a good move to boost buyer confidence, I could definitely see some sellers being very angry with this

  5. I’m going to reserve judgement on this one til I see how far Rajiv Dutta gets on with his plans to make every Paypal transaction protected for both parties. If he can achieve the universal protection he talked about in the Live keynote, then I’d be a lot more in favour of them pushing Paypal a lot harder.

  6. Oh, I’d forgotten about that, bring in zero chargeback risk (even for a slightly increased fee) and that should satisfy sellers of high value items 🙂

  7. Don’t forget to mention Rajiv’s other promise – that every PayPal user, worldwide, will be address-verified by year end.

    One way to look at this (and how often do I put a positive spin on any eBay policy that implements restrictions?) is that everything PayPal have to achieve, to make it acceptable as a potentional “PayPal only” route for eBay, will increase seller security and assurance for using PayPal on their website, plus make it a lot safer to do so as a non-eBay seller.

    At whatever date it happens, eBay will no doubt justify it saying that Amazon already have a payments system monopoly in place (and it’s not PayPal).

  8. I’ve noticed an increasing amount of dvd pirates (both UK and Asia based, seemingly impervious to removal, despite regular reports) who deliberately do not accept paypal because of the chargebacks that no doubt would follow when Buyer IMGULLIBLE and his ilk discovered that their “24 season 6” or “Greys Anatomy season 3” box set for £10.00 was in fact a hooky Chinese burn-off.

    Making life more difficult for these scummers who prey on the innocent and the not-so-bright would be a small silver lining to the Orwellian Pay-Bay monopoly cloud looming ominously on the horizon.

  9. I agree every seller should accept, but not every buyer.

    Verification of buyers is needed, always has been, but forcing paypal in what could be construed as a back door monopoly of the payment system, is not the only answer…


  10. All very well saying that Paypal verification process adds a layer of protection if it were true.
    I have lost count of the number of instances that I have proof of where either a buyer or seller has acted illegaly in a transaction only for Paypal to take no action.
    Ans when pushed they have come back with a stock answer of your “your account of this transaction does not corrrespond with the other party”.
    Also on a slightly different note in the UK if Paypal are holding money and then processing it on your behalf does that not make them A financial institution and as such shouldn’t they have to comply with the law regarding consumer credit?

  11. * Sigh *

    Paypal is a terrible system. It protects the buyer and victimises the seller. I have seen this happen on several occasions, and there are literally hundreds of horror stories on the ‘net about Paypal. Google “paypal horror stories” or “paypal sux” etc and see what you get.

    Strangely, this is not the reason I dislike Paypal. I dislike Paypal because eBay forced it down the throat of new sellers. Thats right, all new sellers MUST offer Paypal as a payment option on ALL items! Im not giving my credit card details to eBay/Paypal, so I cannot open a Paypal account – not that I would anyway.

    But now I am forced to add a disclaimer at the bottom of my auctions that states “Even though eBays new draconian compulsory Paypal rule automatically lists Paypal as a payment option on this auction, please be assured Paypal is NOT an option and will NOT be accpeted. Thankyou.”

    I am not the only seller doing this.

    My point is this: eBay owns Paypal. We all know that, and we would expect them to promote their own products, but forcing it onto people will only make them more determined to resist it. eBay already makes enough money from my auctions, they are not about to force me to give them more money for a product I dislike and refuse to use.

    Oh, I buy more items than I sell, and I refuse to use Paypal to purchase as well.

  12. Jasper: you’re right you’re not the only seller doing it, but be careful because it’s only a matter of time before eBay (or more likely, your competitors) get wise to it, and that will at least get all your listings pulled. And for the sake of your buyers, you need to be looking for a more positive strategy.


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