The Death of PayPal

Years ago when PayPal offered the option to notify me of policy updates I took it. The notices had been a minor annoyance since then, but nothing to actually worry about – until the last one.

The new policy is that items offered on eBay with PayPal must accept all forms of payment PayPal accepts – including credit cards, and furthermore you must in no way indicate a preference for certain payment types. In order to accept credit cards, one has to upgrade one’s PayPal account, whereupon a fee is charged on all transactions, credit card or not. The credit cards I understand – the credit card companies charge fees, so those have to be passed on. Its the parasitic infection of all transactions that bothers me.

Now, it happens that I personally already had this kind of account; I was selling an item I didn’t have great hopes of finding a home for, and didn’t want to scare away the buyer. It was partly my own fault for not specifying payment type – the main problem being that I didn’t realize that a straight-up credit card payment was possible through PayPal. But I did have the option (then) and chalked it up to a learning experience.

Being denied that option, however is the kind of corporate BS that I don’t take, so I canceled my PayPal account.

Strangely enough, a little latter I browsed an article about the downfall of PayPal, which all started when they got bought by eBay. It was certainly reassuring to know I wasn’t alone in seeing a problem.

A little while later, I saw deeper in the latest issue. eBay is double dipping. By forcing everyone to the fee-bearing accounts, they make a percentage of every sale, twice. To be fair one is for a listing service and the other is for a payment service, each of which carries it’s own costs. But the lesson of communism and it’s ilk is that super-concentration of power leads inevitably to corruption, and the heavy-handed policy changes of PayPal-eBay have just that scent of greed.

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