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paypal – are they trustworthy now?

Having read paypalsucks.com I am concerned about the safety of my money if I was to chose to do business with them. However there are many ways of making money by using them.

Does Paypal still suck? If so are there any other better options? The merchantinc.com recommended by paypalsucks.com seems to only cater for business customers.

14 comments to paypal – are they trustworthy now?

  • Ted

    WikiMedia prefers Moneybookers. I don’t know if they’re any good but the fees are certainly lower than PayPal.

  • C. Dominik Bodi

    Personally, I would take everything that’s published at paypalsucks.com with a wee grain of salt. While certain stories might as well be true, and many disgruntled paypal customers use that site to tell their stories, it remains unclear who actually is behind paypalsucks.com

    With all those recommendations for “alternative” services the site is literally plastered with, there is some potential for a conflict of interest, if you know what I mean.

    Fact is, every payment service demands fees. These fees are considerable, even more so for micropayment services. According to what you can read in the press, costs for micropayment transactions can easily approach and go beyond 20%.

    In the light of that, paypal’s fees seem not to be outrageously high. For most payments, paypal has to get the money from the customer’s bank accounts, debit cards or credit cards. The banks operating the bank accounts and issuing those cards are charging for their services, as well. If you happen to have a friend who’s operating a shop that accepts card payments, just ask him or her what he’s paying to the bank to offer that service to his customers. You would be surprised but the fees paypal charges are not different from those the banks charge.

    In the end, only a few points of criticism remain: Arbitrary account freeze-ups. Those stories might or might not be true in every single case.
    The second main point of criticism is about paypal charging a fee for a transaction even if it is only from paypal account to paypal account without any bank account or card transactions involved. One could argue that since paypal doesn’t have to pay any fees to any banks in that case, the costs for such transactions are much lower. That remains valid but otoh costs certainly are not zero.
    The third point of criticism I have personally is specific to transactions within the Euro-Currency zone, not applicaple to the rest of the world, therefore I’ll spare you the details.

    Whether that makes them trustworthy or not is up to you to decide. When it comes to banks, trust is hard to achieve. With the U.S. government having access to every money transfer conducted over the SWIFT network (virtually every bank account to bank account transaction within Europe), questioning paypals trustworthiness becomes somewhat less important, doesn’t it?

    Regards,
    Dominik (just a planet.debian reader)
    Ingolstadt, Germany

  • Anonymous

    You might try creating a bank account solely for doing business with PayPal, setting up “autosweep” (you have to call and ask) to have everything in your PayPal account automatically put in the bank account every day, and then transferring all the money *out* of the bank account immediately, to an account not linked with PayPal in any way. Vice versa, if you want to spend money via PayPal, just transfer money into the bank account, transfer it into PayPal, and immediately make whatever purchase you wanted to make. Do not at any point give them a credit card number. As long as you keep no money in anything PayPal can get at, you don’t have to trust them for anything other than the current transaction. Most of the PayPal disputes seem to come up some time after money goes into your account, when PayPal decides they don’t like something. With this approach, if they ever decide to randomly steal money from your account, or randomly lock your account for no good reason, you hopefully won’t have any money in it at the time.

    This approach will only keep all of your money safe if you don’t get PayPal payments very often. If you get payments often enough that your account balance doesn’t normally stay at 0, whatever amount of money currently resides in the account will remain at risk from PayPal. However, this approach should still keep as much of your money safe as possible.

  • Anonymous

    All that said, by the way: unless you *specifically* need a *PayPal* account, go with some other service. Only get a PayPal account if you need to work with something that specifically requires PayPal.

  • Anonymous

    Oh, also: if your account ever *does* get frozen or charged for any reason, remove all references to it from anywhere you put it, and make sure nobody ever pays money into it again, or that money will go to PayPal, not you.

  • Grant Diffey

    In Australia Paypal is somewhat better regulated than in other places they have terms of service etc. and do not hold monies as they are not a registered bank.

    Jaymz uses them regularly.

  • sdf

    iirc paypal got granted a full banking licence a short time ago in the EU – so they’ll probably be under better supervision

  • My take on this is that most of the criticisms of paypalsucks are “Ideal World” criticisms. In an ideal world, PayPal would be able to make sure that only you ever used your account, charged nothing for their services, gave you money back without question if you ever challenged anything, and responded to every problem instantly. In the real world, people try to phish and scam your account and try to pay with dodgy credit cards, and other banks and industries charge them money.

    Now, of course their service could be better. I’m sure with millions of transactions every day more than a couple may go awry, and whenever that happens to us we always want things to be fixed ASAP. And I do think that its right for them to have to provide better access to their customer support, for example. But they can’t deliver banking utopia, so they don’t promise to deliver it.

    Ultimately, the terms and conditions of using PayPal are not that much different to those on any other piece of software. Try sueing Microsoft because its wordprocessor trashed your assignment, or complaining about how unfair it is that the conditions of that CD you’ve just bought don’t allow you to share it with all your friends. Or you could perhaps live in the real world, where we have realistic expectations.

    And the affiliate advertising on PayPalSucks makes them less than reliable witnesses.

  • I have been using paypal for years now and turn over more than $50,000 per month and all I can say is they are brilliant. I use them on my website as well as ebay and have never had an issue.
    They can freeze accounts and monies if someone says they have not received or did not authorise the transaction or were not happy with the deal (didnt receive what they were told etc) but this is the same as banks do.
    If you have a merchant facility with a bank and someone raises the same issue, the funds will be taken from your account just the same.
    So all in all, Paypal is good.
    I have often rang them for advise and although the person who answers the phone is overseas, they are very helpful and easy to understand.
    Basically I say go for paypal. If you look after your customers, you wont have a problem.
    And to prove I am not working for Paypal here is my ebay site: http://stores.ebay.com.au/Discount-Pumps-Australia
    Cheers
    MT

  • PatSparkss

    If you think PayPal sucks, try doing business across the world with a person who wont use it.

    I have to go to the bank now to buy US dollars to send over seas wrapped in A4 paper and an envelope. It’s the easiest option without using PayPal and it’s a pain.

  • etbe

    PatSparkss: you made half of a really good point. The other half is that some potential payers won’t go to that much hassle and will just do business elsewhere (or refrain from donating).

    I may be compelled to get a Paypal account for this reason.

  • Aussie Citizen

    I had a PayPal account in Australia which was frozen with funds still in it. Lost over $50 :(

  • Gail Bishop

    I paid for a PeeWee Motorbike for my grand-daughter in May, still no motorbike and 2 weeks past her birthday. It was ordered through EBS International who have vanished off the face of the earth. My kids said that it was safe because it was through PayPal. Never ever again shall I trust these type of companies. I have sent several emails to service@paypal.com.au which are being totally ignored.

  • Bliss

    Gail Bishop- please see the thread “Criminal Power seller now out of control” on Ebay’s chatboard – The Roundtable

    You will need with the many other buyers dudded to band together to achieve a refund. As it stands currently for your item, you never actually qualified for Paypal Buyer Protection because the motorbike was listed in the Car, Bikes category.
    Vehicles have a different buyer protection policy, and the main requirement is that the vehicle must be within Australia at the time of listing. You bid/won a pre-sale item being shipped from OS
    Many other buyers have lost out on normal category items too because they were unaware of the Paypal 45 day limit to file a dispute. If you used a Credit Card to fund the Paypal, your best bet will be to try for a chargeback. But please read the Roundtable thread. Plus take a screenshot too of the listing before ebay deletes all evidence.