PayPal - A Safe, Secure Option for Small and Medium Businessmen

Growth in net penetration had led to phenomenal growth in online trade and if experts are to be believed, the trade which has already doubled in the past three years is set to grow at least 7 times in the next 5 years or so. To match this growth, there is a growing requirement for merchant accounts, credit card processors, and payment gateways.

Unfortunately, growth in online trade is matched by a corresponding growth of the parallel professions of internet fraudsters. To compound the problem further, the legal infrastructure, in most countries to cope with net fraud is in its infancy. Electronic contracts that have been issued have not tested the judicial waters.

Getting a merchant account is not easy for all. It is an expensive proposition, in terms of initial set up costs to have secured huckster proof network and security levels have to grow to keep pace with growing threat perception.

PayPal

In such cases, PayPal is an easy option. PayPal, having more than 85 million active accounts and a presence in more than 55 countries, is a fast, easy, cost-effective, trusted, and globally preferred method for online shopping. It is practically having a merchant account, credit card processor and payment gateway all rolled in one. No recurring fees, free anti-fraud tools, no setup or gateway fees, free merchant and eBay tools, and with transaction fees starting from zero, for small merchants PayPal does offer a virtual merchant account at a fraction of the cost. Though for small customers, its rates may seem higher, for high volumes customers, it can be cheaper by about 10% than a merchant account. For example, for a merchant with a turnover of $1 million thru PayPal, while its standard merchant fees could be $29,520, including various annual charges, PayPal charges would be $26,550.

PayPal - A Good Solution for Small and Medium Businessmen and Professionals

With PayPal, you need not have any website, payments can be received using an email account, and even your customers need not have a PayPal account.

If you are auctioning something online, PayPal can take care of automatically notifying the winning buyer of ending of listing with a backlink to the listed item. PayPal also takes care of your shipping needs. It offers you tools to calculate shipping costs, create shipping labels, track delivery, pay for insurance for shipped items, etc.

PayPal has also tied up with Yahoo and you can now build, set up, and manage your own e-commerce website using Yahoo Merchant Solutions including site-building tools, easy tools to manage your orders and inventory, and much more.

PayPal also helps you fight unjust chargebacks by buyers.

Restrictions to Accept PayPal

PayPal has some restrictions on items that can be traded using it as the sale of counterfeit items, gambling activities, child pornography, etc.

Paypal is ideal for buyers too.

Sending Money

Sending money through PayPal is easy. more than 200 countries/regions and support 25 currencies. Send and receive payments easily over borders and language barriers.

It Helps You Earn from Referrals Too

You can earn a reward when friends you invite to join PayPal through the Program sign up and complete an Eligible Transaction. You can put a referral link in your email or website and each time a merchant signs up for a new PayPal business/premier account through it, you can get a commission of 0.5% of payment value limited to $1,000.

Safety Measures

Working with more than 30,000 employees, and using encryption and CVV2 checks, PayPal has a strong protection system to prevent identity theft and it claims 100% protection against unauthorized payments. PayPal also offers you to install a safety bar free for a month to safeguard against spam and malicious emails purported to be through a PayPal account, but after an initial period of one month, you will have to pay for it. Should you enter a dispute with the seller regarding the quality or content of goods, you can approach dispute resolution specialists with PayPal. PayPal has also acquired Verisign Payment Services and has added the industry's leading tools for payment protection.

PayPal has Its Critics Too

Though PayPal has a loss rate of less than 0.5% which is remarkably down when compared with Master Card or Visa, PayPal has a good number of critics as well. A major reason for the grouse is that with PayPal you lose your rights under consumer protection laws. PayPal would not allow you to issue a chargeback in case any unauthorized activity happens from your credit card or PayPal account. They also complain that PayPal has inserted a term to take funds from your bank account to ensure a recovery against you.

The worst charge against it is that if someone pays you with a stolen credit card, your account is immediately flagged as being "criminal behavior" and any money in that account is confiscated!

In fact, in a lengthy public trial, PayPal opted to settle out of court and pay $9.25 million, and walk away from the entire allegation as it feared that judgment may force it to change its questionable practices.

Allegations and critics notwithstanding, it is a fact that PayPal has become a global leader in online payment solutions worldwide. With its renewed focus on customer satisfaction, it should be able to regain its lost ground.