Platform Profiles: PayPal

Peter Roesler, President - Web Marketing Pros

By Peter Roesler

President, Web Marketing Pros

paypalOverview:
PayPal is an e-commerce solution for business that acts as an intermediary for all payment transactions. Their online money transfer system is the de facto internet currency because it provides electronic alternatives to older paper systems for transferring money (i.e. checks and money orders).

Price:
PayPal charges a free for all transactions though the amount varies depending on the size of the seller.

Advantages:
The biggest advantage of using PayPal is that it’s highly trusted by shoppers and vendors alike. PayPal acts as an intermediary for buyers and sellers, so the customer’s account information never reaches the seller’s website. PayPal is also a very dynamic payment system with many options for how people can use it. They now offer PayPal debit cards for some account holders; a peripheral for the iOS allows iPad and iPhone owners to scan credit cards with their devices; and some stores (e.g. Dollar General) now accept PayPal at the register. PayPal is also extremely easy-to-implement by e-commerce standards. The webmaster just adds a PayPal widget, and PayPal takes care of the rest by sending customers to a secure site to complete the transaction.

Disadvantages:
Because of it’s size, PayPal works very closely with the U.S. and international regulators to ensure transactions are legitimate. This means that PayPal will sometimes freeze an account for what it considers to be suspicious circumstances. Your account can be temporarily frozen for suspected security breaches, or frozen for months if your account is under investigation for possible violations. There is also the issue of chargebacks, where PayPal can deduct funds from your account is a customer meets the PayPal qualifications for a reverse transaction (even if you’ve already sent the goods in question). And since the PayPal user agreement gives the company control over all funds in its possession, there is little an account holder can do to challenge PayPal if one of these disadvantageous situations should happen.


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