or is paypal suitable?

Some people deem paypal as insecure due to the enormous amount of fraud they get. So, offering MC and VISA would actually help your business

As a consumer, I really prefer MC & VISA to paypal. Much easier.

Most sites i see with paypal only options I will actually leave instantly and compleatly in a lot of cases. I only use paypal if I have to and i mean have to...

I think the fact paypal has got sites like paypalsucks.com shows how bad it is really...

Taking Visa and MasterCard is essential to most businesses. It is the defacto way to pay on the web in the US and definitely the most preferred.

All depends on where you are / what you are selling. Paypal is there & they are a good company. A lot of people have had problems with them because usually the merchant did not conform to the TOS / AUP or Paypal. Keep in mind that Paypal has quite a few customers. And the more customers you get - you are bound to make some people unhappy from time to time. And those reasons increase because this is money we are speaking about. People love to complain and gripe about a service. We all do it - we tend to forget the past 45 days of service and focus on that 46th day of issues that we had with a company.

As far as Paypal / or your own merchant account, if you are in the United States and doing more than $1,000 a month, a merchant account might be better suited for you. Keep Paypal though in conjunction with a merchant account - if what are are selling conforms to their AUP.

Having a credit card for your business is a very good idea. One reason is for purchasing online as alot websites dont even accept paypal. The main reason I believe a CCard is important in business is that it is great to keep track of your finances because of the paper trail and there are many safety measures in place in the event someone doesnt fulfill what they are supposed to.

We've been using Paypal to accept credit card payments for years without a problem.

On our ecommerce sites, we offer both standard credit card and paypal options - approximately 1/5th of our monthly turnover goes through Paypal, so I guess many people prefer using it.

Touch wood, we've not had any major problems with Paypal in the past year, except for some flakey IPN issues a few months back.

But, previously, when we've been involved with fraudulant transactions against us, I can't say I was too impressed with the impersonal and amateur way Paypal handled it all.

I also make sure I clean out my Paypal account on a regular basis.

It helps with your consumers to know you are legitimate. Having only paypal might work but more and more people are now worried when they see only Paypal because there are no checks done on that business. I personally would not buy anything from a company that does not have a merchant account.

use either or even both, even paypal accepts CC payments just depends what kind of an account you have with them.

Paypal may be suitable for some companies depending of their audience. If you are selling your services internationally, other methods of payment are very important, since Paypal is not available in every country. But regardless, it's a good practice to provide the customer with more than one option in my opinion.

i believe paypal is great thing for small online businesses or sites who are not big enough for a merchant account.

For the record, i'm pretty much sure that none of that site is up to date and some of the "most recent" bits are pre eBay take-over.

I have never had one problem and have had a tiny bit of fraud payments and quite a few "charge backs".

There are other places you can go like www.2checkout.com if you do not want a full merchant account, they also allow the accepting of electronic checks. You pay a little of each sale, no sales, no extra cost.

I do not trust Paypal, I will accept payment through them if I must, but avoid it where I can. Biggest problem with Paypal was that they are not a Bank so you are not insured. Paypalsucks.com has been mentioned so I will offer these two links as well, however they are older (2002) and in how far Paypal has improved....... I can't say, you would have to investigate further.

Consumer Alert: PayPal's Problems: Customer service woes continue to plague popular payment service.

Consumer Watch: Trusting Your Money to Strangers: Online payments are quick and easy, but what happens if there's a problem?

IMHO, having more payment options is an advantage for the consumer.

I've gotten more fraud from 2CO then I EVER have from paypal. This is a fallacy perpetuated by ppl who simply dislike Paypal. I have used them for 6 years for both personal and business and I have had ONE fraudulent item and never had an issue with them in any other way.

On the other hand, I have had MANY 2CO fraud CC attempts and poor service from them to boot, having to change my billing sytem to suit their new ultra restrictive methods, etc.

I'd switch to a merchant account, but I just can't afford the $40 in monthly statement and access fees on top of the per charge fees at this point.

You'll find that the ppl who start those types of sites usually have hidden agendas are are just disgruntled. 1,000,000 happy clients, 1 upset one...so that one starts a site like paypalsucks.com. Happy clients don't start fan sites...lol.

2Checkout is 100x worse then Paypal. Their customer service is extremely subpar, they don't answer tickets, their recurring billing system simply ceases billing for no reason, it's no longer suitable for dynamic business models like webhosting since you need to define EVERY type of possible transaction type beforehand (meaning that you can't just give someone a special deal and send them to 2CO via a link anymore, you need to add that deal to 2CO, then add it to your billing system..makes more work and hassle).

LOL - see, there is where I have to say I never had any problem with 2CO and like it better than Paypal.

In the end you have to look around and see what you like best. Maybe PayPal has improved, but at the time years ago they left a bad taste in my mouth. But you will always find people who do or do not like those things that others swear for or against.

For us it's 5-10%. Perhaps it depends on target market or whatever. I am even thinking about disabling it, to force people use Visa/MC so that I don't have to pay paypal fees and to simplify things

having a visa and master card is important than having a paypal account.

What are your fees for Visa/MC?

I've been using PayPal for nearly four years - I've never had a single transactional problem of any kind, and furthermore, only 3 or 4 people in all that time have told me they didn't complete a transaction because it was through PayPal.

Obviously there's no way to quantify how many people feel like that but don't tell me, but I'm not gonna run my business on the basis of hearsay In the absence of any specific problem I see no reason to change - I do up to $2K a month through them, and it's all been fine.

However I would agree with the point that, ultimately, a serious online business should look at having an internet merchant account - simply because, long term, that's the most flexible for you and your customers, and the most cost effective.

But I wouldn't bother with any of the other third-party services like 2checkout or worldpay, I personally have far less respect or trust for those two than for paypal, all based on personal experience as a vendor; and the overall impression I get from clients and colleagues is that PayPal is the best known and respected. It was the move with ebay that really did it - it's legitimised their brand, and I think that's well deserved.

I don't remember exactly, something like $0.35 per transaction + 2.3%, and a monthly fee of $30 or so. I figure for paypal it's roughly double, plus small overhead in terms of extra time it take to process paypal orders. If I disable paypal, some might abandon shopping cart, but majority would probably pay with credit card. I wonder if it'd be worth it

Until today, I would have argued strongly for Paypal - why use anything else now that Paypal has a buy now with credit cards without joining Paypal. My opinion until today - now we hit something called "Paypal statistical models" which seems to be a fancy way of saying they they are not going to let the transaction through and Paypal is not going to say why. I hit this 3 times today.

Once, client setup a paypal account, but Paypal would not accept the transaction event with a good credit card number. Called support and they said we had hit a statistical model and the transaction would not be allowed unless another funding source was used.

So..... I sent the client $15 with paypal and they received.... but they could not accept. Called support again and you guessed it.... hit a statistical model again and would not allow the transaction even though I have the money in my account.

Days like today make me question my love for Paypal. Others hit this problem?

it is very very important in this century - today i found a nice place where you can gift or purchase a credit card without having any bank account -> https://www.epassporte.com i have recently opened account there and it looks goot to me - you can even send me gifts there.

I disagree. As you said - PayPal is the preferred choice of many start-up businesses. I tend to prefer buying from a more established business because they tend to be more experienced at supporting their customers, and more reliable.

Judgemental, perhaps... but all consumers are judges. There's nothing wrong with that (in fact, it's essential). It's how I want to spend my money, and that's my choice.

Now, I've never declined to do business with a company solely because they used PayPal... but my point is that it's one indicator (among many) of the maturity of a Web site. While it's possible for a large, well-established site to use PayPal exclusively, it's not typical.

I think using PayPal as opposed to taking major credit cards directly give the visitor an implression that you are a "small" company. If this is not your concearn then payment gateway is a waste of money in my mind.

It's only a waste if you're low volume. If you're high volume the cost savings of using a gateway with a true merchant account is very worthwhile.

There are lots of large ecommerence sites that use Paypal as one of the payment processers.

Comes down to this. Startup businesses usualy start with Paypal due to the low cost and ease of setup. Once they get established and have a steady income, they move to add a merchant account (or baby step it with 2CO).

Point is, writing off doing business with a company simply because you don't like the choice of payment processor is to me condensending and judgemental.

I prefer to buy with PayPal if it's available over using my visa, however most people don't have paypal so if you have to choose between credit cards or paypal, go with credit cards.

I have to agree with that. I was warned off by such sites for years, before figuring I'd try it for myself. Never had a single issue. Everything runs smoothly.

On the other hand, I can't imagine many large businesses being prepared to pay for goods through PayPal.

MC & Visa is more widely known consequently more people are likely to use it. Personally, although I make purchases online regularly I have never used PayPal to buy anything. I only recently set up a business Paypal account to receive payments. That was only because somebody wanted to pay for my services with a credit card. Paypal is a lot easier to set up and a lot cheaper than getting a merchant account especially for only one transaction.

Seeing PayPal only makes me question the legitimacy of the business I'm buying from. That's not to say that there's anything wrong with PayPal. It is what it is - a quick and dirty way to set up an ecommerce site. Anyone can do it, which is good for "anyone" but also tells the consumer something.

A larger company that's has more experience and the ability to support its customers is more likely to have a merchant account of their own.

Of course PayPal has lots of opposition out there... they're fairly high-profile on the Web, and because it's used in auctions and other less "official" transactions, there are bound to be problems. But that doesn't mean that the claims of these parties are accurate, or completely legitimate. How much credibility can a site that's devoted to bashing a company have?

Still, I'd recommend using a merchant account. I actually don't like PayPal, and avoid using it whenever possible. I get frustrated with it whenever I do try. (For example, I currently can't buy anything because my credit card is tied to an old account. I regained access to that account and deleted the card - now I can't use it anywhere on PayPal.)

Although I think it's better to have a MC/Visa option (and Amex, ideally), I think paying by Paypal has become more acceptable i.e. it doesn't necessarily connote a small-time business as I think it did in the past.

Cool, thanks for your help.

For me as a consumer - it depends on what I am purchasing. If it is some little script and the site only uses Paypal - then I have no problem with it. But if it is clothes, electronics, etc and there is no merchant account - then no, I would not buy from them. I would be too afraid that it is a fly-by-night company

VISA and MC are an ASOLUTE Must have and Amex is a definate plus if you do business with Small to medium size companies

How many years have you been selling products to the average joe?

Sometimes, when a nobody site does too good a job at integrating their payment gateway to their site, they can turn OFF potential buyers.

Why? Because a person may want to buy something, but feels uneasy with Joe Merchant collecting their info. Now Joe Buyer may not realize how safe it really is, and that Joe Merchant is just passing the info to the processor in a completely safe fashion, but... Basically I think many potential buyers feel safer knowing PayPal is involved in the transaction.

But of course you should have your own merchant account as well as PayPal.

And as far as a site looking unprofessional, or just very small-time, by only having the PayPal option for customers to use, I think there is truth in that perception. So get as many payment options as you can.

What about payment for contests on this site. Is pay pal the best option?

For contests here, yeah. PayPal is easiest.

I wouldn't see a problem with offering paypal or some other method of payment as long as you offer visa and mastercard as well. You're alienating potential customers if you only accept payment via paypal. Offer all three, give your customers choices.

PayPal in their official presentations claims that their fraud rate is half of that of regular ecommerce transactions and I don't have any reason to doubt them, especially since they don't accept customers from many of the high-risk fraud countries.

"I don't remember exactly, something like $0.35 per transaction + 2.3%, and a monthly fee of $30 or so. I figure for paypal it's roughly double, plus small overhead in terms of extra time it take to process paypal orders."

So you are trying to tell me you pay $0.70 per transaction + 4.6% to use paypal? I dropped my merchant account and went strictly paypal because it was cheaper $0.30 + 2.2% for the merchant rate.

I have a consulting site with clients paying by cheque or PayPal.
Who would be the best Visa/MC processor for a low # of transactions?
Does anyone offer a % only deal with no monthy charge?

Oh. Why did I have an impression paypal was charging something around 5%?

There are many misconceptions about paypal...one is the percentage they take but the other is that many people believe they have to setup an account to pay for something. Something that may have been true back in the day but now it's like using any other cart. So, one of the tricks to getting business using paypal is to add to your order page something like, "You don't need to setup an account with paypal. Just use the cc of your choice."

Second to that, there will be some people who won't use paypal if you were to pay them to do it! Others won't use anything else. Best solution is to offer both means of payment.

Visa & Mastercard = a more professional image

so if that is of importance.....?????

The Average Joe doesn't trust Paypal or anything other than Visa or MC.

That's totally subjective and you know it. There is only a tiny percentage of normal people who even know about which 'payment gateways' are used by whom - and a large percentage do actually know of PayPal as large payment provider - eBay use them.

I think you'll find, that this whole incident was your own fault. Shouldn't you yourself be more careful with your credit card information, if you go signing up, inputting your details and then don't remember your password?

We started out with Paypal only.....then about a month later we opened a merchant account through our bank and to our amazement our orders went up by 5x on the first day we placed the merchant account on our sites and the sales have stayed up there.

Now those are numbers we can use! Thanks for sharing...

As others have mentioned, I think it's a matter of the type/size of the business. Obviously, buying common retail merchandise such as clothing, electronics, DVDs, etc from a business that ONLY offers PayPal could be a bit risky. But you never know...

Selling digital goods online, such as ebooks, software, or subscriptions for website content using PayPal doesn't seem like such a bad idea. And, a well integrated/designed business can use PayPal very successfully. As long as the purchasing process is smooth and easy to use. It was a big day when PayPal offered the opportunity for customers to pay without being PayPal members, directly paying with their credit/debit cards. That got rid of a major hurdle, forcing the user to signup for a PayPal account in order to pay.

Next step? Offer localized versions of the payment pages. PayPal is working on having their payment pages in multple languages, so you can tailor the checkout to your customer's native language. (note, I'm praying they come out with the Japanese version soon! But, honestly, it does seem like this has been a long standing promise never made good).

PayPal has some great advantages, especially for startups and small businesses. Free to get started, with a ton of help (not exactly from PayPal, but from other developers using it). The merchant doesn't have to collect the scary bits of customer data (cc numbers, etc).

In the very least, it's a great start point where you can 'test the waters' of your ebusiness from. If your business works well, you can add in a real merchant account/gateway (www.authorize.net).

Very good point...something to think about eh?

And a 13 yr old can get a Paypal account. At least with a merchant account, you do know the merchant has had a credit report done on them and the acquiring bank knows the risks

You need to look at the bigger picture. I am serious about my business and also, I am a webmaster for several tiny little online companies that deal in niche products....and I am serious about theirs as well. We use and recommend Paypal for one simple reason: security

Maybe 'joe consumer' doesn't think about it this way but my take on it is that by offering PayPal I am protecting his/her information and credit card info from falling into the wrong hands. Most of you on this post have indicated a preference for the opposite, I make it a point to *not* buy from small tiny niche sites if they only offer CC payments. Who are they and what are they going to do with my info once I give it to them? Right, you don't know so why trust them? PayPal (IMHO) offers my customer protection.

If you don't beleive me, let me tell you a story about some dude that was running a hosting company out of his basement and 13 year old son was the system admin. Are you sure you want to give your personal info and CC# to a 13 year old who may understand what they can get away with as a minor? I'm not picking on kids, but the point is you don't know who your giving your info to and at least PayPal is a brand that you know.

I'm only commenting on the small business trying to carve a living online...as for big online retailers, merchant accounts are a must!

PS: None of my customers have ever complained or inquired about changing payment processors and they all use PayPal. I'd be curious to know how many webmasters out there have had to either switch to/from PayPal due to customer request?

13 year olds can't get merchant accounts without their parents putting their necks out on the line for them.

Yes it really depends ...especially if you are a using a 3rd party processor you need to be extra careful. God forbid you fall into the hands of fraudulent Companies like paysystems etc.

actually you can offer visa and mc through paypal shopping cart and they don't have to crete an account, right !

Having a Merchant account shows that you are serious about your business. PayPal is a good service, but I wouldn't use it to conduct my business on the net..

my 2 cents.

Hi,

One of my websites that sell products (see: GlowSticksDirect), has the option for customers to pay with Visa, M/C, Delta, Switch, Meastro and for the last 3 months or so, PayPal aswell.

In this time, I would say that we are now receiving about 10%-15% of payments through paypal, the big majority still choosing to pay by standard cardit/debit cards.

Remember that for those of us that 'live the internet' so to speak, things like having and using a PayPal account are second nature, but for the normal 'man in the street', shopping online can be scary enough, without additional things like giving your credit card and personal details to a company you might never have heard of(i.e PayPal)

Depends on what you are selling, but I would say that offering more options to customers can only help finish more sales and also build credibility and confidence in you customers opinion of you.

Good luck.

M.

To some "men on the street", PayPal is actually a security blanket, since it provides an intermediary recognizable service brand between them and the merchant. (ie: the perception they have a big company to run to and complain to if the merchant rips them off).

i personaly find paypal alot easier

There are indeed a lot of misperceptions about PayPal. We offer both PayPal and the 'traditional' credit card payment option (through Authorize.net). Some facts:

• PayPal does not cost more than a merchant account, in fact, the rates on transactions are lower than most merchant accounts, without a monthly fee.
• Customers can pay with a credit card without opening a PayPal account. This is a fairly recent change.
• PayPal offers customer service to resolve disputes for non-delivery etc. with a system that's much easier to work with than most merchant accounts.
• You can't get by with 'just PayPal' for very long, because of their security measures. For example, a single credit card can only be associated with one PayPal account, and can't be used without logging into that account.
• Paypal's fraud prevention measures are stronger than a typical credit card processor, but this means that people in some countries can't use PayPal to buy.

Even though we offer both options, we state a preference for PayPal and the vast majority of our transactions (>95%) do go through PayPal, so I don't buy the idea that you're turning away a lot of customers without offering a traditional credit card payment option.

Ask yourself this question ...

Is growing your business and making it easier for your Customer to buy - Is that important?

Once you answer that question, you will have answered your own question!

Best of luck,
Ansel

I would use both. The more payment options there are the better for the customer.

On all payments I receive I use paypal, on my services that I buy, I use CC. Having both helps.

My paypal fees are 30 cents per transaction plus 2.9% . Its a bit more than CC, but certainly not double.

paypal is not available in many countries.

As a lot of others have stated, it's my opinion that offering PayPal as your only payment method may be bad, but you may want to include it with your Visa/MC option as well. I know that sometimes, especially when purchasing computer related products, I prefer to use PayPal, especially if I have a balance. I've actually paid a little more for a product so that I could use PayPal instead of my credit card.

Also, I'd be interested in the number of PayPal transactions versus the number of Visa/Mastercard transactions for their books. I've purchased six books I think and I've used PayPal everytime. I'd be interested to know the percentage of total transactions that each gets.

Just my two cents...

same here... i hate the fact that when you try to purchase something on PayPal you HAVE to make an account... then when you come back - they have your card on file and you have to 'confirm' the account... whatever they call it...

i prefer to use a normal merchant account when i purchase items online - which is VERY rare if the company only has PayPal...

Paypal is ok but should never be the only or primary processor. Many, many consumers look at a web site as not a real business if all they accept is Paypal. Case in point. We tried to book 5 limos one night for a company party and the limo company only took Paypal. We tried to use our company Visa whcih had once a long time ago been signed up with a paypal account. Since we did not know that Paypal account name, when we tried to purchase, the form said that we had to "sign in" because the card was already ties to a payal account.
We had no clue of the logn name or email address since it had been so long ago that Paypal was signed up for so we could not use the card. After wrestling with it for about 30 minutes, we moved on to another limo company that had a merchant aco**** and accepted credit cards as a real business. Because that first company on took Paypal, they lost close to $5000 that day.

That is just one example...

I would never say it's ok for a business to just have Paypal, they should have other options available if they or clients need them.

Many companies that I buy stuff from only take Paypal up front, but if you drop them an email, they'll send you to Auth.net/2checkout/Worldpay/Protx etc... where you can pay via Visa/Mastercard. Fraud is a huge issue, and if you get a lot of chargebacks that merchant account won't be available for long - so I can understand why some companies choose not to make it a public option, but have it available for those who bother to email and ask.

Well, PayPal allows customers to purchase products without registering for a PayPal account. They can pay directly with their Visa, Mastercard, Discover, or American Express.

That's a nice feature... just wish it worked with the PayPal subscription system.

I'd have both a merchant account and offer PayPal, if possible. PayPal allows those with an existing PayPal account balance to pay with that - or out of their bank account, (which appeals to those trying to pay more with cash than credit).

I think it's a sign if a business only offers PayPal. I think any business serious about online business should at least offer real Visa/MC processing and possibly PayPal as an option. I like using PayPal for personal transactions but use a business credit card for business purchases. I don't go through PayPal for that either.

Actually, I believe you have to have a CC# to get confirmed on paypal.