Buy now, pay after delivery with PayPal

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PayPal have launched a new Top Buyer program in the US called PayPal Advantage, and one of the new features they’re testing is the ability to buy (both on and off eBay) and only pay when the goods are delivered.

According to a post on the “Pay After Delivery” allows you to check out as normal and select Pay After Delivery as your payment method, receive and verify your purchase and then if you’re satisfied PayPal will automatically withdraw the money from your bank account 14 days after your purchase.

There should be no difference to the seller, and in fact just as you can’t tell if a purchase is funded by credit card or PayPal balance you also won’t know when the buyer has paid with Pay After Delivery. PayPal will be funding the purchase upfront so as a seller you’ll still be paid before the goods are shipped.

Other benefits of the PayPal Advantage program are Priority Telephone support with a free phone number, exclusive access to offers from merchants and invitations to spend time with PayPal employees at exclusive events.

This looks very much like a soft integration of Bill Me Later, the credit facility allowing shoppers to buy online and pay later. PayPal purchased Bill Me Later in October 2008 and it makes sense to start merging the offerings of the two companies.

Pay After Delivery is an interesting concept as it removes concerns about purchases arriving and being as described. However as it’s being offered only to PayPal’s most loyal and prolific customers at the moment these are the people who are already spending online. Would you spend more if you could pay after delivery and would it give you more peace of mind knowing you can examine the goods once they arrive before the payment is taken from your bank account?

Via Auctionbytes

14 Responses

  1. it already happens!!!! why the flim flam and flannel, all a buyer needs to do is file an item not as described, or not received and the money is as good as back in the bank,
    and if your in italy or germany its just about an instant refund

  2. Every single one of my Paypal payment issues has been as a result of money being tranferred from a UK bank account rather than with card or out of Paypal funds.

    So anything that increases the number of payment transfers by Paypal of money from bank accounts is a very bad thing for UK sellers.

    What if the buyer is overdrawn at the time the request is made by Paypal. It is going to be the seller who suffers 17 or 18 days down the line.

    Thanks but no thanks. I will opt out of this scheme if ever it is offered.

  3. It was bad enough just jumping through hoops, now they want to set the hoops on fire.

    Heaven help us – this is bound to go PEAR shaped

  4. If ebay allow you to charge a premium percentage extra on the listing price if the buyer chooses this service then it may be something sellers may opt for but then you come back to all the feedback issues around such moves.

    Really eBay need to look at how inovations can impact how buyers offer up feedback. The DSR system is a real handicap to eBay if they want to be inovative in other areas and a far more flexible (and simple?) approach to feedback is required first.

  5. eBay would have to make far more information available to sellers about buyers for this system to work. Payment history for example. Are eBay going to do this?

    Would buyers be happy to allow ebay sellers to see their credit and payment history?

    After all isn’t having a credit and payment history what all this is about?

    Or are sellers going to have to rely solely on the Paypal vetting process?

  6. How is this any different for the buyer and seller than the already 100% buyer protection? Either way you aren’t out anything unless you are completely satisfied. All this seems to be is PayPal extending a bit of trust towards the buyer assuming that their bank account will have money in it when the payment is due. In exchange they can increase their bottom line by increasing the number of bank transfers.

    At least I hope that is what it is and they aren’t expecting the seller to be on the hook due to payment failure. is like that (holds the seller liable if the buyer doesn’t have the money) but they at least make the charge the moment you ship rather than 14 days later. So with them you can at least recall the package.

  7. Paypal already do this. We have had a few payments refunded, where Paypal forward us the funds but due to whatever reason the payment fails.

    This is in their t’s & c’s and VERY frustrating when it happens (although very very rare)…Maybe it was a trial for this roll out, who knows.

    What I do know is that it’s the start of a very slippery slope, customer service is one thing but come on, surely the very least that should be required of a buyer is for them to pay!

  8. My concern is that it will become “compulsory” soon enough and the risk transferred to the seller.

    Can you imagine?

    Paypal insisting that you ship the item before payment.

    The thin end of the wedge?

  9. On another subject I was accused of not liking change. I must admit that I do not like change for changes sake when there is no apparent benefit to be gained for the change. I must admit that thinking about this change I cannot see any benefit at all to the seller. If the goods are still in our possession and the payment goes pear-shaped then we just sit on the delivery. But if it has been posted and received by the customer when the payment fails for whatever reason it is always going to be the seller who suffers. No I do not like this idea at all. It Stinks.

  10. I work for PayPal and just wanted to help clarify a few things. Pay After Delivery is currently only available to a limited number of customers as a test to allow PayPal to evaluate customer interest. Based on the response, we will decide if the program becomes available to more customers. Pay After Delivery is not a credit product in the sense that there is no credit check and no interest charges.

    As was stated above, PayPal will pay the seller immediately so that they can receive their funds and ship the item to the buyer. The buyer then has 14 days to receive their item and verify it is what they ordered – if everything is fine, there’s nothing they need to do and PayPal will withdraw the purchase amount from their bank account on the 14th day. If the item was not received or significantly not as described, a customer can file a dispute through the normal dispute resolution process. If he/she files a dispute before the 14th day, PayPal will not withdraw any money from their bank account until the dispute is settled. And if they do not, the customer still has the standard 45-day period to file a dispute.

    The idea behind Pay After Delivery is to give buyers extra peace of mind knowing they won’t be out any money while waiting for a dispute claim to settle. From a seller’s perspective, there will be no change from today’s process – they will get paid immediately and will only have to refund the payment if the buyer has an issue. Returns due to buyer’s remorse are not covered.


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