Careful, Paypal users

[Skybird]

German economy magazine "WISO" on 2nd channel this evening had a docu on Paypal. While I am not after the examples they listed where the company misbehaved, demanded irrelevant and most personal data from customers and delayed for several months the access to money already transferred - to work with this money themselves and make a profit by the the resulting interests- , the interesting news is with regard to Ebay.

Ebay advertises with Paypal (which is a daughter) that it is a kind of insurance against transactions going wrong, so that you can get back the money, and reverse any business deals, if the bad event takes place, for example yopu get an item which is not matching the description or is a different item. However, be advised that according to the legal situation in Germany, this advertising is misleading, because it has zero, rien, nada, no legal basis at all. Legal situation is such that in Germany you have no legal basis whatever to demand such an financial transaction being reversed, therefore Paypal can decide by their own will whether they follow such a request, or not. You can beg them to stand by their pormises, and when they say No - what they do - then there is nothign you can do about it. Your imagined safety is - illusory.

In other words, the advertised customer protection of Paypal - is nil and void with the German laws. You have no legal demand for it, and Paypal has no obligation fulfill it's advertised service (they even admit it in the small print somehwere, very well hidden), and you should consider their "customer protection" to be a completely arbitrary courtesy. As the examples in the video show, they are willing to refuse that even if they have not checked the circumstances and facts of the situation and objects of dispute between trader and customer.

You might want to check the legal background in your own countries.

German video:
http://www.zdf.de/ZDFmediathek/conte...0?inPopup=true#

I never liked paypal, since it is another location where my banking data and personal data gets collected without me having any legal control over it and without knowing what happens with it and what they do with it and whether they sell it, or not. Ebay pushes Paypal because the trader has to pay a fee up to 4% of the bid - which in other words is another form of income for Ebay. Considering that you have no legal claims for customer protection, no guarantees for safe transaction and no mandatory safety functionwhen using Paypal, but that you get hooked by misleading advertisement and false promises, I do not feel tempted any more now to use it. As far as Ebay is concerned, I have a numerical and relatively low limit beyond which I do no accept deals per Ebay. where there are precious items involved, like two old chess computers, I establish personal contact and make sure that I can pay vis-a-vis and take the item home after having gone there. that is simple and healthy reason, and when you do any different, you should not complain if somebody fools you to your disadvantage.

And that in principal is true with all internet buying.

[kiwi_2005]

I dont use paypal and even if i wanted to I can't, my bank dont even recommend it instead i use what we call a debit card & that too is a hit&miss with some online stores.

[Onkel Neal]

I've used Paypal for 10 years, several thousand transactions, zero problems.

It's no different than credit cards or home equity loans. Some people just have issues.

[Skybird]

Why do you use it? From a legal perspective, it is NOT safer than regular bank transaction in advance. It is even worse if oyu do not use it to buy, but to sell. Than you pay them a fee for ... well, essentially for nothing that is legally binding. Essentially you pay them for hoping they will behave nice in case of trouble. Which thy might. Or might not. Is that worth your money?

To me they are one of these many companies than emerged due to the internet and who pressed themselves between seller and buyer without any real need for another party to interfere there. Afterbuy is another that comes to my mind - always tripling the shipping delays. I love it.

Serious and respectavle shops in the internet trade on the basis of even tighter laws in Germany, than street shops. In Germany, even in cases wehn taking back an item is a question of copurtesy by the street shop, it is mandatory for internet shops to take things back without explanation for 14 days. In the street shop you depend on the cooperation of the shop owner if you want to give something back that is not broken or a case of warranty (warranty: again, he can chose to repair it, he must not take it back for money, or exchnage it), in internetshop you have a legal obligation. Even more, for serious shops it is a question of advertising and forming a reputation not to betray customers, or make them angry. That'S why the shops I used in the past, were top in service. With such shops, Paypal is even more unneeded.

That you use it and made it a habit, does not mean that it is good or needed, Neal. Maybe it is you having the issue here. and credit cards: I only use a Visa for internet shops where I have no other choice than credit cards. I never use it elsewhere. Why paying them a fee for putting themselves between me and the transaction partner, taking my money from my hand and giving it to him - and wanting to get payed for that "favour"?

Some modern behaviour patterns are a bit nuts, imo, and often they remain unreflected.

[XabbaRus]

Well my Visa card never charge me a fee for paying for something. Not on top of what I pay anyway.

The only time they take a fee is if I use my card to get cash which I never do.

Sky if I sell an item through an auction house they charge percentage fee. It is how they make money.

I haven't had a problem with paypal on the odd occasion I use it. This seems to me to be another Skybird doom and gloom, everyone is out to get you thread.

[Skybird]

Originally Posted by XabbaRus

Sky if I sell an item through an auction house they charge percentage fee. It is how they make money.

At Ebay, if you use paypal, you pay twice. first for the auction at ebay, and then for offering paypal to your customer.

[SteamWake]

Yes some people have issues with PayPal (raises hand)

[porphy]

Well, the double cost for the seller is probably balanced out by the amount of (international) sales you can get on E-bay, when using paypal. I find paypal convenient and easy to use as a buyer, which probably in itself means I buy more this way than otherwise. I guess that is true for quite a few people e-baying.

Using your credit card or debit card for paying private persons or dodgy internet shops is a big no no. Not many buyers would like to use international bank transfer or money orders or sending checks in envelopes. The last one is the cheapest way, but who in their right mind send big sums of money this way without paying for special delivery and insurance? International bank transfers and money orders will cost you extra anyway, and as buyer you already pay for postage as well. Bank transfers might even include paying for the sellers bank costs, and money transfer is almost the same as sending the money in an envelope with no security, you have no real way of knowing that the person recieving the money is the actual seller. They even warn you to use this for paying for goods of the internet when you use Western Union for this purpose.

Of course Paypal isn't totally satisfying. They act as judges when buyers and sellers disagree, and the users have no legal ground to stand upon beyond that. But I don't see the huge difference from other business relations where your consumer rights are supposed to be defended against con sellers. So, yes you have to do you homework on internet shopping and restrict yourself to goods an prices you find acceptable to buy this way. In case your buy is a dud, you can walk away from it without too much harm. (so far it never happened to me)

The seller pays extra and I would guess paypal is doing very well from all the transfers going through their service. Paying up front and collecting the goods in person might be a good way to do it, but it severely restricts what you can sell and buy and with whom you can do business with.

Cheers Porphy

[Kapt Z]

Originally Posted by SteamWake

Yes some people have issues with PayPal (raises hand)

Me too. Lucky it was only a window sticker around $3.

[Onkel Neal]

Originally Posted by Skybird

Why do you use it? From a legal perspective, it is NOT safer than regular bank transaction in advance.

It is a transaction service. Simple. No one pays a fee to send payments, there is a standard fee to receive payments, just like using Mastercard or Visa. No big deal.

[Skybird]

You try hard to not get the point, hm?

While it is correct what you said, and the general reason in using credit cards in general can be qestioned (for example I never use credit card in stores, as I said, only in internet shopping when I do not wish to miss the item in question and the business model is exclusively credit cards), the ppooint is that Paypal suggests an additonal legal backwards insurance that it does not include. That way there is no point in using paypal instead of regular bank transaction, regarding legal standards it is not any safer. You do not get qany additonal security, nor the legal option for additonal claims if something goes wrong. Especially for the selling party this is bad news - becasue they pay additional fees for a transaction service while beliefving they get something additonal for that fee. But they don't. If you do not get anything additonal for it, why sopen ding additonal money when you already pay regular fees for your banking account or your normal credit card?

Clear now?

[Onkel Neal]

Originally Posted by Skybird

You try hard to not get the point, hm?

Actually, I try hard to ignore you when you are going off about something you know nothing about except what you've read somewhere.

Guess I should try harder

[Skybird]

Originally Posted by Neal Stevens

Actually, I try hard to ignore you when you are going off about something you know nothing about except what you've read somewhere.

Ah, that truly is a disarming reply.

Well, there is not much insider knowledge you need. Since I did sell items at ebay three times, I know that paypal costed an additonal fee for me if I would have offered it, additional to the auction costs. And since the legal situation is clear by the laws, they claimed (and is confirmed by the consumer protection organisation over here) it thus is clear that Paypal gives the impression to offer an advantage in form of a safety guarantee that to the customer appears as a self-obligation of Paypal that is legally binding, but as a matter of fact is not mandatory at all, and gets refused at times even if Paypal refuses to check the case in question. The customer gains nothing from using paypal that he can really be sure of. He depends on trusting that all parties (now one party more: Paypal, that is) will play clean and nice. And if Paypal refuses to do so, there is nothing he can do, not more than if he had sent money via his credit card or banking account. Paypal charges fees for an advertised feature of assumed guarantees that are no guarantees at all.

And you seem to have a problem with me for saying that.

If you want to be safe because there is more than a low ammount of money involved, Paypal does not increase the safety of your interests in case you want your money back if the item you bought is not matching the descrption, or is a different one than what you have ordered.

If it is something vital to you, do it via old-fashioned personal contact. Evade sending money in advance, or using credit cards. Or Paypal. Serious and respectable shops offer you payment by bill. I honour that by paying the very same day I got something. Paypal gives you no advantage over a credit card - it claims to do so, but it doesn't.

At least with the legal situation in Germany. Check in your own country how it is with your laws. They said on the German Paypal representation that they even say it somewhere deeply hidden in the small print that the seller by paying Paypal essentially only pays for the good will of Paypal - nothing more.

Strange thing to waste money on, if you ask me. You pay for a service that does not give you anything real and legally binding in return. that'S like buying a book that two days later they take away from you again.

I know that paypal can be used for services not related to ebay auctions as well. Note that the report is about Paypal within the context of Ebay.

[porphy]

But Skybird, you do get something for the fee. The resolution process doesn't cost extra, should you use it. True, it's not a special insurance in a strict sense or some extra legal force behind this, which some may think. And of course paypal doesn't do all this to just to be nice, clearly their reputation and commercials in this area are closely connected to how well trusted their service will be by buyers and sellers. If they can't handle disputes and claims well, no trust, less users, less money for profit. I think it's a good thing that paypal cases are looked into, but I don't think it's right to say that paypal tries to make you pay for nothing with their service.

But if you pay or receive payments through Paypal, there is a clearly stated process for both disputes and claims between buyer and seller, and both have been verified to actually be the persons to hold the account connected to paypal. And if you as a seller get a chargeback for money, this process originates from the credit card company anyway, so paypal only handles the resolving process as they did the transaction.

As in every dispute things can go wrong, you can get unfair judgements etc. this clearly goes for paypal as well, to think otherwise would be naive, but you see these unfair cases all the time when customers and sellers or companies get in a dispute. And it might be worthwhile to remember that paypal can not know in advance who is right in a dispute or a claim, hence the rigid demands on sellers and buyers when they enter this process. You can't be a sloppy buyer and hope for money back, and you can't be careful enough as a seller to ensure you have absolute proof that you did ship the item and ensured it would arrive at the right address.

If you pay any other way, you have the same legal rights, but how would you proceed to get money back for goods that never arrive or is significantly different from the description, or even a fake item? Or if you have an international buyer pulling back transferred money via the credit card company because they argue the item never showed up? I don't think paypal is perfect, but I think there are some real advantages to use that service when buying and selling things on the internet. It seems to me, that if you want to con other people, there are more hoops to jump through before you can set someone up. (For the record, I have never been involved in a dispute or claim so this is purely outside observations about how paypal works.)

But it's still the "internets", so you have to be conscious about that everything that looks too good probably is, as the saying goes.

cheers Porphy

[Skybird]

You guys do not wish to see it, I must conclude. Fact is that Paypal advertises with telling you you are safe from getting stranded with a transaction you are not happy with - yopu would get your money back, if needed from them, and nthat this is somewhat a given. So you do count on it. You think: if I pay by usiong paypal, even if the seller messes things up, I could get5 back my money from the paypal guarantee. But it is noit like this - you have nnothing to claim from them, you depend on their willingness to be nice with you. You can't make them living up to thei9r promise. It is a misleading advertising by them. The buyer do not pay fpor paypal,l they just get the data on his banking account (you do not know a little bit what they are doing with it). But the seller pays for the the paypal "service", additionally to the auction fee.

I wonder what the problem is in understanding this. People are being made thinking that paypal tramnsacitons are any safer than non-paypal transactions, andn that any addito9nal safety features and money-back-rules come into play, and are obligatory to be fulfilled by Paypal - and this is a very popular misconception. Even more, morons can trick people into buying something messy, making them feel safe by offering paypal. the custommer thinks "Ah, I could try it in safety, it's paypal, I could get my money back anyway, even if it turns out to stink". but evntually - he cannot. Eventually Paypal will refuse to refund in place of the moron, even 9if you can prove that paypal never has checked the case, and did not take note of the evidence you gave. And you have no legal weapon whatever to make Paypal live up to the misleading promise they advertised with. As the German video gives several examples, it is not rare that customers get dissapointed from Paypal when it rejects their demand for refund. not before the magazine - a program focussing on taxes, fincance laws and economics - intervened, Paypaol all of a sudden accepted to refund, as they advertised they would. Which is more about public relation then, than about acceptance of theirs.

Consumer protection centres in germany sday Paypal is no ihgh profiole offender, but also no unknown. That means: they are not the worse but also no rare offender.

People, do not make this more complicated than it is. As a matter of fact it is very, very simple and very, very obvious.

Originally Posted by porphy

If you pay any other way, you have the same legal rights, but how would you proceed to get money back for goods that never arrive or is significantly different from the description, or even a fake item? Or if you have an international buyer pulling back transferred money via the credit card company because they argue the item never showed up?

Porphy, the same question is with regard to Paypal. You think you can put a safe bet that they would be more friendly regarding these incidents, as they advertise, but they must not be. You are wrong if you think just by using Paypal yopu have more legal control over interventiuons in case the transaction goes wrong. You believe you have that by using Paypal - but you haven't. And if they decide (as in the examples where they even were proven to not have checked the facts, and just sent form letters of rejection that illustrated they did not check the issue by making wrong claims themselves) to not stand by their advertising, then there is nothign you can do about it. You can't legally force themn, that is the point. You are not any stronger or weaker as if you hd made the transaction via credit card. You depend completely on their good will and kindness - like you do when using a credit card or pay in advance.