We can't ignore something that I think is a pivotal point - and that is the reason why some sellers are not bothering with merchant facilities.
If their business sprang up on eBay and they have got to accept PayPal, it is understandable that they cannot see the sense in the short term of having to pay PayPal fees and ongoing merchant facility fees. I feel some sellers have not even investigated whether it is worth it for them, being dissuaded by other people's discussion about what it would cost them to have merchant facilities. The fact is that there are some extremely affordable online payment solutions around, and I can assert from experience that the costs are not only not as bad as some think, but it's actually better than PayPal would be - for me.
Given that, why aren't sellers checking out what payment facilities might be better for them in the long run? Are they so tied to the idea of buyers preferring PayPal? Are they so tied to eBay being a necessity for their business? Are they so riveted to the notion that PayPal is "safe" that they ignore the whole question of being able to accept credit card and debit card payments?
I'd like to throw a few more points for consideration into the ring.
1. Banks could not do exactly what PayPal does - for a reason. PayPal's fee structure and dispute & claim resolution and handling of funds are unique to it. Banks have much more stringent requirements, and concurrently you'll notice that the requirements for business accounts and payment gateways (to enable a seller to sell online by accepting credit card payments) are certainly more rigorous than PayPal. What tests of your credit, reliability, standing and ability to pay do you need when you start accepting PayPal?... Er... er... well, they don't actually check that, do they? No. And there we are - huge difference between business account with payment gateway model, and PayPal-accepting seller.
2. Is this why some sellers don't want to try getting merchant facilities? Is it contributory to it? Do some sellers just think it's all too hard, too ongoing a cost, too much of a commitment? Do they think of PayPal as the easy option? Or do they actually think PayPal is safer for sellers than accepting credit card payments? Honestly?
3. I suggest that the identify requirements for a business account with payment gateway is one reason why fraud is so much easier via PayPal than it is via a business account with payment gateway. Fraud can still exist via the latter... but it's harder for obvious reasons.
4. Are sellers sitting down and doing the mathematics to work out their costs? Are they including risk factors if they accept PayPal? Are they seeing beyond eBay to a viable business with a powerful e-presence? Are they seeing beyond the restrictions of PayPal to being able to decide on their own business strategies? For that matter, are they thinking in terms of being able to cancel a transaction, to accept or reject a credit card, to refuse a transaction on the basis of feeling suspicious about it? They can do that. They can check with the issuing bank to see whether the country and/or address matches the country and/or address of the cardholder.
5. Well, there's still the issue of how someone without a debit card or credit card can buy from another country or from an online seller. Clearly there's a technology issue and there are security issues... but yes, I think that can be done, with computers possibly having a slot for EFTPOS cards. That should enable sellers with existing business accounts and payment gateways to accept such modes of payment. But will that help when people are worried about identity theft, worried about entering PINs online...? And what about buyer protection in that case? Legislation's going to have to expand to cope with it all, and I think the EFT Code of Conduct will have additions. Should such modes of payment have the same degree of protection as credit card payments? Can that be justified financially and security-wise?
6. What about non-businesses that want to send money to each other? In Australia, we can transfer money between bank accounts without being slammed by a huge fee, but to make an international bank deposit is between $20 and $30 - clearly not a viable fee for items whose total cost is around $20. It would effectively double the cost. So banks could make it possible to use any of a number of conduits (such as Paymate) as well as create their own for fund transference without copping that cost. But that still doesn't address the issue of security and fraud. Whose fault is it (well, actually, whose responsibility is it) if the money goes through without any technical hitches, but the paid-for item ends up not arriving? Since this will be dealing with international commerce, we get into sticky waters. Seriously, how will such issues be resolved? Who takes the financial risk? And how will it be paid for?
I think these points are well worth taking into account, and may show the possibilities of solutions by pointing out some of the problems and issues.
