eBay has announced that Dutch payments firm Adyen will become the marketplace’s primary payments partner and that eBay itself will be “intermediating” payments.
Here’s what they say in the announcement from yesterday evening:
“eBay intends to further improve its customer experience by intermediating payments on its Marketplace platform. In doing so, eBay will manage the payments flow, simplifying the end-to-end experience for buyers and sellers. eBay has signed an agreement with Adyen, a leading global payments processor, to become its primary payments processing partner. PayPal, a long-time eBay partner, will be a payments option at checkout for eBay buyers. The transition to full payments intermediation will be a multi-year journey, and eBay will move as quickly as possible to complete this process within the parameters of the Operating Agreement with PayPal, which remains in place through mid-2020.
As a leading global commerce company, eBay believes that payments intermediation is strategically important to improve the buyer and seller experience on its platform and will enable the company to further innovate on behalf of its customers. In a rapidly changing and competitive ecommerce landscape, shoppers expect to be able to both shop and checkout on the site on which they transact. As eBay intermediates payments, shoppers will be able to complete their purchases within eBay. As a global marketplace that operates in over 190 markets, eBay also must continue to provide localized payment options for buyers and sellers that are tailored to their unique needs.”
What this seems to mean, on the most basic level, is that the entire payments and checkout flow will be retained fully within the eBay site. You likely won’t need more than just an eBay login to both buy and pay. It seems likely that eBay will administer payments and disbursements for sellers too with the help Adyen. There is no doubt that this is the most significant and bold move from eBay since PayPal and eBay split from each other in the summer of 2017.
The markets have responded to the news and PayPal shares have taken a hit but eBay has received a boost.
What do sellers need to do?
The answer, at the moment, is absolutely nothing. But in due course this is likely to significantly change how they process and record payments and also how they administer their business. After all, PayPal isn’t going to be the primary payments system for eBay, so there will be some transition to the new systems to make. It’s going to take time, early steps will be made in 2018 and 2019 but the full roll out won’t be complete until 2021.
We’ll doubtless return to this story and keep you posted.
32 Responses
A reason to justify ebay fee increases down the road. PayPal will still be an option but no doubt ebay will not be discounting their higher all inclusive fees if a buyer chooses PayPal as the payment option or other payment options. And what about high volume sellers who currently benefit from lower payment charges? What chance ebay giving fee discounts for higher payment volumes? Very little I suspect unless you fall in line with their carrot and stick approach and at this time the fee discounts are not really worth the extra effort and stress in the greater scheme of things. Whilst dressing up changes as being beneficial to both buyers and sellers eBay only do things to benefit eBay.
For an average, non-fulltime business, eBay’s fees are high (10%). Paypal fees are high (7%, I believe). We are always told to pay more, and do what they tell us to do. For what? I’m not sure, because sellers always bear the burden, and this is no exception.
Sounds good to me. I’ve had nothing but problems with PayPal, twice now I’ve been hacked, my identity stolen along with money out of my bank account and they keep fighting me saying there’s no way it happened on their site. sorry PayPal time for you to go.
Great news for all eBay sellers who have had no choice but to use PayPal for the last few years. With their poor support and what almost seems like random limitations and suspensions on accounts, no reasons provided, its finally time they compete in the market.
“intermediating” WTF!!!
Will they also be confusculating the English language?
It does show an impressive level of self belief/delusion (delete as considered appropriate) that a company which cannot design a functional shopping cart, or give it’s sellers correct ship addresses, consider themselves best placed to “intermediate” our payments. What could possibly go wrong?
The would be a good opportunity to remove the mandatory offering of Paypal on all listings.
Presumably this was part of the big news Wenig was talking about.
Lots of questions.
How much will the fees be? More? Less? The same?
It might mean the end of the paypal chargeback scams, but will Ebay buyers be happy?
Will this be the beginning of an Amazon type disbursement payment system?
Can’t see Ebay passing up the chance to either A) take an even bigger cut from the seller, or B) withhold payment for a time like Amazon do.
Maybe I’m just cynical after all these years of Ebay manipulation.
Not sure whether this is good or bad news for sellers.
As mentioned above, it will only be to Ebays advantage. I would guess they will cut their new payment processing fees during the take up and while paypal is shunted out, then they will increase their costs and insist only Ebay payment solution is allowed. Same old Ebay in my opinion, its not broken so lets fix it (sic) anyway.
Could be interesting or just another white elephant with fee increases to feed it…
The only issue I have ever had with PayPal as a service provider is chargebacks – Order comes from eBay (via a logged in customer account). Then passed to PayPal (via a logged in customer account). Then you get a chargeback as “Not Authorised” and without tracking your stung for the sale price plus a chargeback fee…
Not fair really when eBay and PayPal have “Supposedly” verified the customer along the way…
Hopefully Adyen will take responsibility when things go wrong with customers payments…
Bad news for cashflow – PayPal is received and available instantly, card processing normally overnight and then 3 days to clear the bank.
Also, customer PayPal email addresses will no longer be available
Here is a link to Adyen pricing. They service Netflix, Etsy, Uber and many others so creditable. However I suspect none of these have ever handled payments for eBay type customers!
Although eBay will be acting as a middleman buffer between the buyer and Adyen so for Adyen should be business as normal.
https://www.adyen.com/pricing
Clearly they will do a wholesale deal with eBay as their customer. Sellers will not have individual bank type accounts in the way we currently do with PayPal. Knowing what fees eBay are paying it will be interesting to see what the eBay fee mark up will be for sellers.
What a lot of negativity there is about eBay, this is something that has been on the cards for a while since Paypal & ebay seperated.
Most of the above is just assuming as much bad will come of it because people have nothing constructive to say.
My thoughts are that eBay is probably struggling to get additional revenue out of sellers. I think they have taken out as much value as possible on shop fees and listing fees. Most sellers would stay clear of add-ons such as £2.50 to “Display a large photo in search results with Gallery Plus” or any of the other enhancements. There’s no doubt in my mind that they would like to grasp more but have little room to obviously extract more cash.
The current position is that eBay’s take is normally 10% and PayPal’s take is about 5%. On top of the eBay commission, PayPal charges 3.4%, a cross-border fee where applicable and a fixed 20p. I pay about 15% per sale. It feels like it is twice as much as I would think reasonable; a commission of about 7.5% total would seem reasonable for simply introducing the sale. The % commission on postage seems to be exploitation and like many I am fed up with funding both eBay’s Money Back Guarantee and PayPal’s Seller Protection Programme. I’m sure I, like most sellers, would prefer simply having the money transferred into my bank account and without either PayPal being able to get at it nor eBay. And I would like cases properly investigated, but with both companies they seem to have forgotten whose money it is.
A payments platform which is low cost or ideally zero cost would save all sellers money and make the platform less price uncompetitive.
if its good for buyers that will do us
we will adapt
Adyen accepts PayPal as a payment method, I believe this will allow buyers still to use PayPal but I believe eBay may hold the payment via Adyen in a similar to how Amazon works #LoosePrediction
Watch this space 🙂
Were there any sellers out there for whom this issue made even the top ten list of stuff they want eBay to fix?
(And who uses a term like “intermediate”? Really? I mean I get it, and it’s a scary word.)
I dont think its possible to despise ebay more, not content with with deceitfully withholding a service millions pay for in the form of secret sales manipulation (something when investigated may well turn out to be the biggest corporate online swindle in internet history) now this. many have been looking for a way out of the ebay scam, they’ve just been handed its, and Amazon handed the throne for good as ebay are about to dump the one reason many small businesses use it.. YOUR MONEY is not withheld for corporate greed to cream first. This isn’t another episode of ebay blowing their feet off with incompetent poorly thought out management decisions, this is putting the barrel in your own mouth and taking off safety. ebay just committed to nailing its own coffin shut. Good riddance I say.
I’ll ditch Paypal as soon as possible, and won’t miss it one little bit. Mind you, I would say exactly the same about eBay if there were a viable alternative.
well maybe we should all join new market place onbuy as they use stripe, we listed some lines there and we have had a few sales the last week or 2 so i think the more sellers you list the better it will be come.
so lets all do some thing about it and maybe ebay and amazon will listen to sellers one day
Yes the system will obviously make eBay more money as they never do something for nothing. The money held for days will earn an interest payment from Adyen and some of their charges are more than we currently pay for paypal. I know many moan about paypal but personally we have never really had an issue either with ebay payments or direct paypal payments via credit or debit cards. This new system will still suffer the same chargebacks as all credit cards offer so many protection methods for buyers now so it will be as bad for chargebacks. The biggest issue will be when they uncover how much they charge to deposit the funds in your bank as currently the paypal service is 1-2 hours and free.
For eBay to be clutching at these methods for earning more revenue is putting the cart before the horse.
The site sales are falling like a stone now and they are in need to do something about that. To earn more revenue look at their fees and sales.
i will do the maths for you eBay. As you seem unable to.
10 items sold for a pound makes £10 you then take 10% so earn a pound.
You then put up your shop fees by 40% meaning our overheads go up by that.
So now we charge £1.40 per item and only sell 5 making £7 so you get 70 pence.
So you are actually making it cheaper for buyers to purchase from many other platforms or outlets.
Then another grab was changing to 11% to counter this but that’s obviously not enough.
Grabbing fees from the shipping is another way you grab and so again you are making the items more expensive again lowering sales.
Just remove shipping from the fees and band shipping charges by item weights and sizes etc to stop sellers loading it and check shipping method stated is actually used.
That would save a small business like ours £4,800 per year.
Secondly if the big companies want to use eBay as a big advertising system because its cheaper than TV advertising then charge them. Do not set ratings and metrics by their ability to perform and meet targets. Therefore killing the little businesses. Exposure on the site should be equal. As everyone is paying in percentages.
If you cannot see this eBay then please just type a search in google “eBay UK sales plummeting” and see for yourselves what fools you are making of yourselves.
Hopefully before you fall completely into the abyss with just Tesco, Argos and other big companies being your only revenue stream, you will wake up and smell the roses because once your traffic falls below a certain level they will abandon your site like rats off the proverbial sinking ship.
What a cheerful lot! You’ll have more options.
Devon Wenig presents yet another varnished turd.
They will tell us they plan to manage all our payments for FREE! Saving on PayPal fees…eventually kick out PayPal…then they’ll increase selling fees to 15%
@Tyler
You’re right. Thanks for correcting me, or I’d probably never have found out.
Having now clicked on all the tabs under the payment section, I have finally found the transfer request option, which would allow me to take some out before the next scheduled payment. Up until this point, I’d taken it as per the summary page “that was your last payment date and the next one is…. ” was Amazon policy.
Still, 3-5 days for processing it is a bit shoddy. There’s no reason this couldn’t be instant.
Never heard of this company until the announcement came out so did some checks on there own website. On the surface it looks good. They charge 0.9 – 1.1% plus 10 cents (which is euro cents which is equivalent to 10 pence UK)
Between using Ebay and our own websites with Paypal we are on 1.9% + 20p so half on both scores.
Because we use woocommerce for our websites I did a search on the plugins to see if you could do payments through them right now and to my surprise there was none which shows them to be really small compared to Paypal or not really widespread known for a developer to make a plugin.
So looking at say last months figures as a rough calculation then we would save about £300 a month on fees which is about 1/8 of our Ebay fees.
If it was just that then all would be good but you just know EBay will have something up there sleeve to get more money from sellers to get the savings the sellers will gain so will be interested in future announcements. Anything detrimental about extra costs will only make us put more effort to be more sustainable with our own websites as using Amazon and Ebay is becoming more and more unsustainable due to the very unfair and high costs.