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PayPal vs Merchant Payment Processor

by Emailrevealer
6 replies
I know that many of you have no other choice but to use Paypal and others think it's the best thing on earth but here's my experience with it.

I used to offer my clients the option of Paypal or a merchant payment service via Authorize.net.

About 75% chose Authorize.net and 25% chose Paypal. I noticed that the disputes, claims and charge backs on the 25% of paypal users was just as high if not higher some months than the merchant payment gateway.
But I bought into the Paypal hype that using Paypal would increase my sales by 20%.

I had a problem and I had my paypal pw stolen and had to suspend my account for about 2 months until Paypal could resolve it..

I only offered Authorize.net.. .. I noticed right away that the "aborted" sales dropped down to almost nothing and my sales actually went UP!

It seems that buyers were coming to my site, accidentally choosing the paypal option and when they saw that they had to join or sign up they were aborting the sale and leaving.
Now that I only use authorize.net I barely get any aborted sales at all.

Also I know most of you give 100% refunds upon requests but I don't and I dispute just about all charge backs. Disputing a charge back with a merchant payment processor is a piece of cake. It's 1 fax and the money is back in my bank in 14 days TOPS. With Paypal it was a nightmare with tracking numbers and sometimes it would take 6 months for the money to be returned.
#merchant #payment #paypal #processer
  • Profile picture of the author whitewave
    thanks for the tip - will check them out! I hate paypal
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  • Profile picture of the author Alexa Smith
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    Originally Posted by Emailrevealer View Post

    It seems that buyers were coming to my site, accidentally choosing the paypal option and when they saw that they had to join or sign up they were aborting the sale and leaving.
    Why did they see that? It isn't so: customers don't need either to have or to open a PayPal account, to pay by credit-card through PayPal.
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    • Profile picture of the author seasoned
      Originally Posted by Alexa Smith View Post

      Why did they see that? It isn't so: customers don't need either to have or to open a PayPal account, to pay by credit-card through PayPal.
      They USED to, and many pobably still think they have to!
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  • Profile picture of the author Bruce NewMedia
    Originally Posted by Emailrevealer View Post

    ...I only offered Authorize.net.. .. I noticed right away that the "aborted" sales dropped down to almost nothing and my sales actually went UP!

    It seems that buyers were coming to my site, accidentally choosing the paypal option and when they saw that they had to join or sign up they were aborting the sale and leaving.
    Now that I only use authorize.net I barely get any aborted sales at all....
    This may be only a matter of semantics, but what you are calling 'aborted' sales, I think of as just normal prospect behavior reviewing of the sales checkout process...they usually haven't made up their mind yet, and investigate what they will need to do to actually purchase, if the price on the sales page matches price on order page, name of vendor etc.

    Like Alexa, I'm not clear how they are seeing a requirement to join first before they can make a purchase?
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  • Profile picture of the author noble
    On a somewhat related note I prefer most other processors to PayPal. PayPal has a lot of issues such as black and white dispute processes where people know how to get their item and get their money back.

    But, you still have to accept PayPal often times so you can use a merchant like Plimus or 2CO to accept PayPal payments without have a PayPal account.
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  • Profile picture of the author seasoned
    Emailrevealer,

    First of all, claims like "it will increase sales by 20%" are usually BOGUS, because many may compare it against something STUPID, like one of its old "competitors", or they may use a merchant account with NO SSL, or they may be some place people don't think they can trust.

    That said, I personally like the idea of paypal hiding my details from vendors, and not requiring me to pull out a credit card.

    whitewave,

    Authorize.net does NOT deal with money, etc... they are a gateway. Think of a merchant account like a standard hair dryer. It can't really dry your hair, so you plug it into a power socket, and viola. Well, most merchant accounts don't really work on the internet, so authorize.net is kind of like that outlet. The difference is that they connect you with the processor which connects with your account. And you DO need SSL and authorize.net compatible software, and the merchant account. There used to be only two real players in the game. Authorize.net is one. The other went bankrupt, was bought by verisign, and sold to paypal for paypal pro. Anyway, paypal was a VERY latecomer, and got to where it was by being VERY simple to use.

    Steve
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