Ebay/paypal policy change... Seller Beware!

Who needs the headaches and fiscal losses generated by those companies? I say we just sell through the forum classifieds or craigslist and pay up the trifling 3 percent to keep them going. I don't care about the "convenience" PP offers. I can wait a few days for a postal MO... good as cash. And the higher prices fetched on fleaBay? They take that excess from us anyway so we might as well just share the lower pricing between ourselves. We really don't need those giant leaches sucking our blood.

Aren't we all sick and tired of being "used"?

thisismyname09 said:

I don't see why people are holding off on shipping items until the payment clears.

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Well my reason is that (a) the item is very expensive, and (b) if I do send it then there iwll be a period during which I will have neither the item nor the payment. And then (c) Ebay decides when I get the payment... not the buyer! That is outrageous.

Consider what can happen. If you ship an item and the buyer gets it, that seller can then easily retain the item and simply lie about receiving it. Then what? Then you, the seller, have to launch a very expensive and time consuming investigation, trying to prove that the item was in fact delivered.

So you might think: no problem, UPS/USPS/FedEx etc. can just certify that the item was shipped. Well actually that's not true. I can give you one pricey example that caused me much frustration. I bought a new lens from B&H; it was very expensive. After a couple weeks I remembered that I still hadn't gotten it and so I called B&H to inquire whether it was backordered. They said they'd shipped it long ago, and indeed their tracking info and mine both showed that they'd shipped it and that it had been delivered!!!

So then I contacted the shipping company (UPS) and they said, look, we delivered it to your doorstep on such and such a date. The tracking "proves" that. Well guess what, they certainly had not!!! I had no lens, and I had been checking my doorstep religiously! And I lived out in the ocuntry, there was zero probability of theft. Well, B&H was wonderful about it, they realized that I had done many grand of business with them and was not the kind of person to try to make a buck off some film lens. In fact, they said it had happened before and they started to pressure UPS from their end and threaten to recoup the cost of the item from them. Then after a few days... magically... guess what appeared on my doorstep!!!! Turns out the item was stuffed in some back room at UPS. The deliveryman had simply not done what the tracking info claimed he had done. There was never an explanation nor an apology from UPS. So for about a month I had no money and no lens!

My point is: this is but one example of how this policy can easily spiral into an endless bunch of disputes involving multiple parties. Such multi-party disputes can takes *ages* to resolve... or may end unresolved.

It will be *very* easy for a buyer to say they didn't get the item, and then what?!! You've got no item and you've got no funds. Ebay might suspect something is wrong and discontinue the buyer's account... but so what, you can get another account easily.

To top it all off, like I said in a previous post, paypal claims that *ebay* determines the hold, not paypal. So then if a problem arises, your funds are held per ebay's whim.

YARTBFKEHB&H!










Yet Another Reason To Buy From KEH, B&H, ...

Steve

keithwms said:

Consider what can happen. If you ship an item and the buyer gets it, that seller can then easily retain the item and simply lie about receiving it. Then what? Then you, the seller, have to launch a very expensive and time consuming investigation, trying to prove that the item was in fact delivered.

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Your buyer could do the exact same thing if there were no 21-day hold. This policy does not increase your risk of being ripped off in any way. And delivery confirmation IS sufficient proof for you, the seller, to get your money. If PayPal hasn't released the funds within 48 hours after you have provided them proof of delivery, a call to PayPal customer service should get immediate action. Any seller who isn't using delivery confirmation or tracking is absolutely foolish.

This policy was implemented to protect PayPal from having to reimburse buyers out of their own pocket if scamming sellers make off with the money. It has nothing whatsoever to do with protecting sellers or buyers.

BTW, here are the criteria for held payments:

https://www.paypal.com/helpcenter/m...&countrycode=US&cmd=_help&serverInstance=9006

Ralph Javins said:

If you do not have a PayPal account, you are not even allowed to make a bid.

I have not purchased anything there since last fall when they implemented their "PayPal required" payment policy.

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There is no such policy. The actual policy requires sellers to offer at least one form of electronic payment. It can be PayPal, a CC merchant account, or another approved payment service (see eBay for a list).

eBay also allows sellers to accept checks or money orders IF, and ONLY IF, the buyer asks the seller for permission to pay that way. Sellers can't initiate the request, but they are free to agree if the buyer asks.

So while it may be inconvenient, email the seller and ask before you bid.

I've never had a seller hold my purchase hostage for 21 days after I paid. I usually pay within 6 hours of the auction close and see shipment confirmed within 7 days. Unless a seller prominently posted in large letters at the top of the ad that they would take 21 days to ship, I'd be giving ones as feedback and filing a dispute. My experience as a buyer is that sellers that don't ship quickly, usually don't ship at all. I'd much rather see people use alternative marketplaces if they don't like ebay, rather than disregarding the rules. The rules and guidelines set up expectations on both sides of the transaction.

PayPal and eBay need to send very clear notifications that payment has been sent and that same cannot be withdrawn unless a valid dispute has been entered. Then PayPal and Ebay need to make it even more important to ship promptly (an eBay "delayed shipping" warning).

If they do something like this, the system might become a little bit more like an escrow system, which has some advantages.

Does anyone know whether these holds are being applied to non-eBay transactions (e.g. a transaction between two APUG members)?

Matt

MattKing said:

Does anyone know whether these holds are being applied to non-eBay transactions (e.g. a transaction between two APUG members)?

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I think the asnwer is no. The paypal agent with whom I corresponded wrote that the hold is controlled by ebay, not paypal:

We are stating that eBay communicates with PayPal in order to place a hold on the transaction. PayPal is owed by eBay. PayPal does not control
your eBay account in order to override the requirements that place your
payment on hold.

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So I think you should be fine with a paypal transaction as long as ebay isn't involved.


However, she went on to say...

Your payments will not be held if you meet all the
following eBay requirements:

* You have been an eBay member for 6 months or more, and

* Your total feedback score is 100 or greater, and

* Your buyer dissatisfaction is less than 5%.

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...but actually I meet all three of those requirements and still they issued a hold. So paypal isn't deciding what gets held, apparently.

I've bought and sold since this change came into effect, and it has actually proven to work *for* me. It was no problem at all.

They hold the money to be sure the seller actually delivers. My son bought a phone that was not as described, so the money was returned to us after we returned the phone. If the seller had already had the money in his hot little hands it would have been tough luck for us.

http://www.gittigidiyor.com/ in Turkey does the same thing since they started the business in 2001. It works w/o any problems. Later in 2007 EBAY became their shareholder. It seems they got the idea from gittigidiyor.com...!?!?!?! The site currently uses EBAY's (or a very-EBAY-like) software system.

Okay, but jgcull, would you honestly ship away a $1k+ item before receiving payment? I would not, because the way I'd get my $1k+ back, in the event of a dispute, is very complicated. As I said a few times already, ebay issues the hold, not paypal; whereas paypal actually has the money, sort of in escrow. So if you have a dispute... where do you go? Well I am not going to go through it all yet again; suffice it to say that I see no straight-forward legal way to recover funds in a timely manner.

I don't dispute that their policy may protect buyers somewhat. I am a buyer and a seller, so I get that, I really do! But this policy introduces a very thin layer of protection by delaying transfer of funds and arbitrarily penalizing good sellers. This policy is designed to skim extra money off a sale... not to protect anyone. If I wanted to scam someone, what ensures that I don't ship a lump of coal??? How's this system of protection going to work then? Ebay's policy only requires proof that something shipped!! :rolleyes: Genius.

Bottom line, it is clear that better solutions are possible e.g. making the hold time proportional to the amount of poor feedback, as dbonamo proposed back in post #23.

keithwms said:

This policy is designed to skim extra money off a sale... not to protect anyone.

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Are you saying it is a Ponzi scheme? :confused:

Steve

Steve, skimming can be done in an entirely legal way. Suppose that you handle hundreds of millions of dollars of sales and you want to skim a few bucks off each sale by holding the funds a few days. There are purely legal ways to do this, e.g. borrowing against the pool of held funds and investing them or creating fee-generating lending services based on those funds and collecting interest. Easy peasy. If you had a billion bucks in your bank account then you'd collect interest, even if there were a constant stream of checks coming in and going out. That is essentially a free ride, you are making money off of borrowed assets.

But if you have funds on hold in some account and pass that off as revenue, then that would be illegal because it would amount to false reporting of earnings. (which is essentially what Madoff did: he relied on incoming investments keeping up with demands for cash out, which is easy to do in a rapidly growing economy, and the scheme doesn't get flushed out until a large number of people try to withdraw at once)

Anyway let me be crystal clear: I am not saying that what ebay/paypal are doing is illegal, I am saying it is illogical and will ultimately hurt their business.

Mike1234 said:

...done eBay or PayPal for years now. Both are a complete and utter mess thanks to poor ownership/management from Meg and Pierre.

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Fully agree with these remarks! eBay can often be confusing--bad enough--but nothing has *ever* gone right with PayPal for me, a buyer.

The system can be balanced by letting the seller choose whether they're going to ship to the winner *according to their profile note*. If the winner doesn't have a good buyer's history the seller may opt to ship to the next highest bidder which they consider is trustworthy indeed...

jgcull said:

My son bought a phone that was not as described, so the money was returned to us after we returned the phone. If the seller had already had the money in his hot little hands it would have been tough luck for us.

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If your son bought it on eBay, you're wrong. You would be reimbursed by PayPal even if the seller already had the money. That's the reason for the hold policy; they don't want scammers to withdraw all the money from the account to avoid a "not as described" or "not received" complaint.

keithwms said:

Okay, but jgcull, would you honestly ship away a $1k+ item before receiving payment? I would not, because the way I'd get my $1k+ back, in the event of a dispute, is very complicated.

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You seem to be under the mistaken impression that, before the 21-day hold policy, you could hang onto the money in the event of a dispute. In fact, if the buyer won the dispute, PayPal would take the money from your account to reimburse the buyer. If you didn't have sufficient funds in the account, PayPal would take any future deposits until the shortfall was covered. If you stopped using PayPal, they might hire a collection agency to recover it depending on how much was involved.

keithwms said:

I don't dispute that their policy may protect buyers somewhat.

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Buyers were fully protected before the hold policy was implemented. This policy has nothing to do with buyer protection.

Since Ebay owns Paypal, you are, in essence speaking to the same organization. They love to pull the "good cop - bad cop" routine and run you in circles.

I have been writing my senator and congress men to urge them to push for an investigation of Ebay INC. and their questionable business practices.

moose10101 said:

You seem to be under the mistaken impression that, before the 21-day hold policy, you could hang onto the money in the event of a dispute. In fact, if the buyer won the dispute, PayPal would take the money from your account to reimburse the buyer.

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No, I wasn't under that impression. But apparently you are saying that there is no point to the 21-day policy because... "if the buyer won the dispute, PayPal would take the money from [the seller's] account to reimburse the buyer." So... what you are saying is that this punitive option already existed.

Hmm, do you think it could just be a mechanism for them to hold onto funds a bit longer, funds that aren't even theirs in the first place?!!! :rolleyes:

~~~

Now look, if ebay wanted to introduce a new, more tightly mediated escrow-style payment method then they should do so, and I might even use it. But in that case, people would specify "payment by escrowpal" in their listing and everybody would clearly understand the terms a priori when they entered into the auction.

But this is very different from changing the terms on a payment method and then revealing it after the sale and saying, "gee, sorry but you belong to a very small group of people who can't use paypal the way you've always used it." There is a big difference.

~~~

Anyway, the point of all this is that I am trying to alert people that if they sell by ebay/paypal, they may not get the funds prior to shipping.

We can debate the merits of this policy but the fact is that this is the policy and if you use ebay/paypal, you're stuck with it. And to make matters worse, you apparently won't even know whether your funds are going to be held until you actually conduct the sale. (as I said before, according to the emails sent to me by paypal and ebay, I should have been exempt of the hold)

So... caveat venditor!

I've seen a few posts here trying to make sense of this whole issue and trying to apply logic. I have some sad news. There is never any logic when it comes to money. Those in charge will always scroo the little guys. It's just a fact of life. The big fish eat the little fish for lunch. Our only recourse is to play the game by their rules or by-pass them. I choose to not use feeBay or Pay-thru-the-nose-Pal. I refuse to pay or accept payment via their monster machine and I don't buy or sell through it. It's up to us to stop the madness.

keithwms said:

No, I wasn't under that impression. But apparently you are saying that there is no point to the 21-day policy because... "if the buyer won the dispute, PayPal would take the money from [the seller's] account to reimburse the buyer." So... what you are saying is that this punitive option already existed.

Hmm, do you think it could just be a mechanism for them to hold onto funds a bit longer, funds that aren't even theirs in the first place?!!! :rolleyes:

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Sigh. At no time did I say there was "no point" to the policy. Once again: this policy DOES NOT increase YOUR vulnerability to a buyer complaint, valid or not. This policy protect PayPal from "sellers" who had no intention of delivering anything to the buyer.

keithwms said:

But this is very different from changing the terms on a payment method and then revealing it after the sale

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AFTER the sale? They tell you when you're listing the item. Doesn't this page look familiar? It should:

keithwms said:

Anyway, the point of all this is that I am trying to alert people that if they sell by ebay/paypal, they may not get the funds prior to shipping.

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Fair enough.

It might be nice to give ebay/paypal the benefit of the doubt in this, but I don't think they deserve it. They may claim this is done to somehow protect buyers, but I agree with the folks who say they do it cause they get to float the funds for a longer time.
This is based on my experience with two bad paypal transactions as an ebay buyer. They came out ok for me in the end, but not because ebay or paypal did much of anythng on my behalf.

it is easy to make a huge amount of money by interest alone for 21 days ...

the third party ( non payral that is ) that accepts cc transactions
charges fees that make payral look like a bargain.
at least pp only charges you the fee /transaction if using a ccard ..
like 1-3% as any merchant is charged ..
but the 3rd party agent charges a monthly account fee &C
( or they did the last time i checked ) ...
as stated before, it is too bad a few bad apples have spoiled it for
the rest of us ...
that said, i know there have been issues with counterfeit money orders &C,
so while payral is a useful service (sometimes) the seem to have a lot of people backed
into a corner ...

oh well ...

moose10101 said:

Doesn't this page look familiar?

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Yes it does, but frankly, you really should read it more carefully! And you'd better read it like a lawyer if you have a lot of money on the line. It says (my emphasis added in bold)....

Some payments may be held...

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(doesn't say which payments or why or in any way specify the triggers)

Paypal will release the hold without a buyer dispute, claim, chargeback, or other action.

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(how does one define "other action," exactly?! This is very ambiguous phrasing, and deliberately so. If such "other action" occurs, then this allows them to reset the clock back to 21 days.)

...and to top it off...

The hold may be released earlier if....

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(not the hold will be released, the hold may be released!)

So there you have it, a totally ambiguous bunch of nonsense that releases them from any obligation to transfer the money from the buyer to the seller in a timely manner.

All I'm doing is quoting them, you know, I couldn't make this sh*t up if I tried!

Personally, I REFUSE to use paypal. I had a horrible time with them, so now I pay with postal money order ONLY. If a seller takes paypal only, I dont bid. I notify sellers in advance about MY policy prior to bidding, and 99% of the time I get the okay. Of course, my evilbay rating is excellent, and I always pay immediatly, and I dont mind waiting a few extra days for my items. I think EVERYBODY should refuse to use paypal, and see if their policy changes.
Rick