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eBay had a payment service called BillPoint. When eBay realized Paypal was the better product, eBay purchased Paypal and got rid of BillPoint. Paypal has their "virtual terminal" feature but needs a lot of work. I think they bought the VeriSign payment gateway service to get up to speed without having the re-invent the wheel.
I moved from Authorize.net to Verisign last year after Authorize.net got slammed by DDoS attacks. Now Verisign's reliability will undoubtedly go downhill considering this new corporate parent.
Yes, I think you are correct. If Paypal leaves the VeriSign payment service alone to operate as a separate entity, reliability will be the same. But eBay tries to bring VeriSign to their in-house platform, it could spell trouble. Paypal was mostly trouble free before eBay bought them.
paypal has been expanding their payment offerings so that they can process credit card payments directly, so that online merchants can use paypal as a gateway for their card processing, and customers do not need to use a paypal account. my guess, that's what this acquisition is about.
You're right though about Google payments. Although, it's not good to put all your eggs in one basket...
We use VS gateway with a Bank of America Merchant account. Now I wonder if Verisign will force us to drop BOA in favor of Paypal. And at what price? Currently Paypal is expensive compared to large volume merchant accounts. Maybe this will result in some more cost effectiveness, although with Ebay as a parent never count on costs going down.
I really doubt they'd make customers change their underlying bank - if they did, people would likely leave in droves. It's much easier to switch payment gateways than merchant accounts.
I just feel like we finally got a stable solution here. PayPal courts us constantly. We do take PayPal as an option, but we hate it - it's far too cumbersome for high-volume sales.
Let's hope that they really keep this unit separate.
Currently Paypal is expensive compared to large volume merchant accounts.
Out of curiosity, what rates are you using for comparison?
Keeping in mind that PayPal offers lower rates for merchants with higher volumes...
(Go to the PayPal home page and click the "Low fees" link to see the full rate table)
...how does that compare to what you would pay for your gateway plus your merchant account?
-Visa/MC: generally 2.02% plus a small transaction fee from VS
-Amex: 2.99% plus same trans fee
If we did a ton of Amex, it'd be worth PayPal's 2.2%, and for us, it probably is at our current level. The problem isn't the money - it's dealing with PayPal.
how does that compare to what you would pay for your gateway plus your merchant account?
Paypal is 1.9% on over 100K per month which is a very good rate. However they also charge 30 cents per transaction which is high and their international rates are very high which make up a considerable amount of our business. The one benefit of PP is that when you refund a customer you get your fees back (as far as I know in all situations) rather than getting charged again like with a regular merchant account.
However as others have said, dealing with paypal both from a reliability standpoint, service standpoint and reporting capability would make it difficult under any circumstances to work with them.