Google Launches PayPal Rival

Google Checkout Launched

Roy van Rijn informs us that Google's new online payment system is now online. "Under the name Checkout, the venture offers an incorporated manner to search, advertise and pay. If you buy something on Checkout, 2% and $0.20 go to Google. Paypal, the biggest competitor uses 1,9% and $0,30. Analysts compare Google/Paypal to for example Visa/Mastercard living peacefully together, while others predict the end of Paypal." W3K adds "You can use your Google account to store an unlimited number of credit cards and addresses. The service allows you to track all your orders and shipping in one place," and adds a link to a quick video tour.

Good for the customers

[BigDuke6_swe]

Let's hope there won't be a need to create more sites like this, http://www.paypalsucks.com/ [paypalsucks.com]. Because Paypal works pretty good and what seems to be what people complain the most about is the poor handling of fraud and disputes.

monopoly at eBay

[giorgiofr]

Monopoly? I can accept payments in about 3615 different ways on eBay. What are you talking about?

Re:Huh?

[Anonymous Coward]

1-9% or 1,9% or 1.9%? Is there a specific price where Paypal is cheaper?

Uh, .30 + 1.9%x = .20 + 2.0%x, so .10 = .001x, or x = $100

So up to $100, Google is cheaper, above $100 Paypal is cheaper.

just great

[BugDoomBug]

An additional spam header coming your way

"Dear Valued Customer, In an effort to protect your security and combat identity fraud we need to periodically confirm your account activity and identity. Please click here, login using your google account information, and complete the highly detailed personalized questionaire.

Sincerely,
Not a Phishing Attempt

So anyone grab checkoutgoogle.com for this yet?

Customers DON'T pay...

[jsharkey]

Would you be prepared to pay 2% on every single purchase you made at an online store just so you don't have to "fill out forms"?

Remember, the $0.20 + 2% is paid by the seller and is taken out of the actual price. Consumers will see no price difference.

Re:paypal's safe as long as it has a monopoly at e

[The Cisco Kid]

You are not forced to use Paypal to pay for eBay auctions. Each seller, for each item they list, can choose what payment methods they accept. Some accept PayPal, some don't. Some accept only PayPal. Some will accept Money orders. Even for sellers that only accept PayPal, you can usually pay them through PayPal using your CC without creating a PayPal account - in effect just making PayPal their CC processor.

US residents only!

[dapyx]

Has anyone noticed it's only for US residents?

By agreeing to this Terms of Service for Buyers, you represent that you are:

18 years old or older;

capable of entering into a legally binding agreement; and

a resident of the United States.

Re:Huh?

[tiltowait]

I believe the comma in lieu of a period in a European thing. Kinda looks pretentious, but submitter has a .nl address. Not the best copy edit to use them interchangeably however.

My math says that Google would be cheaper for anything over $100.

Re:Customers DON'T pay...

[Fnord666]

Does anyone know what Visa and the others charge for their service?

The amount charged to merchants for a sale varies greatly depending on the agreement between the merchant and the card processor. Factors can include the number of monthly transactions, total monthly dollar amount, number of chargebacks, swiped vs. manually entered transactions, etc. In general the google figure is probably in line or a bit lower than what most small business merchants are charged per transaction.

The interesting things will be how chargebacks are handled, what fraud prevention measures are in place, and who eats the cost of fraud. With a credit card I get a lot of protection and infrastructure that handles all of this. Google will have to at least match this before I will consider using it.

Personally I still don't know how Paypal manages to avoid being classified as a bank by the government.

Only in the USA

[Roy van Rijn]

Remember, when you sign up for Google Checkout you can fill in any country you like, but the Terms of Service [google.com] says:

- 18 years old or older;
- capable of entering into a legally binding agreement; and
- a resident of the United States.

So only people from the United States are allowed to use it yet :( And most supporting companies don't even ship outside the US.

Re:huh?

[Bitsy Boffin]

Different parts of the world use different symbols for numeric representations, comma is used as a decimal separator in sme locales, I suspect that it is in The Netherlands, where apparently the submitter comes from. He probably just typed it in the second time out of habit, the rates for Google perhaps he copy and pasted, or specifically remembered he's talking to a predominatly American audience.

All you need to know

[tomstdenis]

10. Disputes

GPC will provide various tools to assist Customers in communicating with each other to resolve a dispute that may arise between Buyers and Sellers with respect to their transaction. If Customers are unable to resolve a dispute, we can mediate disputes between buyers and sellers if either party requests assistance. If this occurs, we will review the dispute and propose a non-binding solution, if appropriate. For more detailed information, please see our Frequently Asked Questions.

GPC may offer a feedback or other ranking system on the Service to assist you in evaluating other Customers of the Service. You acknowledge that any such feedback or ranking system represents solely the opinion of other Customers of the Service, and is not an opinion, representation, or warranty by GPC with respect to other Customers of the Service.

You agree to release, GPC, Google, and other GPC affiliates, and their agents, contractors, officers and employees, from all claims, demands and damages (actual and consequential) arising out of or in any way connected with a dispute. You agree that you will not involve GPC in any litigation or other dispute arising out of or related to any transaction, agreement, or arrangement with any Seller, other Buyer, advertiser or other third party in connection with the Service. If you attempt to do so, (i) you shall pay all costs and attorneys' fees of GPC, Google, and other GPC affiliates and shall provide indemnification as set forth below, and (ii) the jurisdiction for any such litigation or dispute shall be limited as set forth below. However, nothing in this Terms of Service shall constitute a waiver of any rights, claims or defenses that you may have with respect to a Payment Transaction under the Buyer's card issuer agreement, the card association rules or applicable state and federal laws, such as the federal Truth in Lending Act or the Electronic Fund Transfer Act.

If you are a California resident, you hereby expressly waive California Civil Code 1542, which states: "A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if not known by him must have materially affected his settlement with the debtor."

Re:New Revenue Streams Trend to Conservatism

[Doctor Crumb]

Read their pricing scheme; sellers get free transactions if they use adwords, and the more they spend on adwords, the more free transactions they get. So, while this is definitely a new revenue stream, it is *also* a way to further bolster their main revenue stream.

1,9% and $0,30 ?

[mochan_s]

The 1,9% and $0,30 rate for Paypal is if you recieve more than $100,000 to your account and you have a merchant account!

Normally, it's 2.9% + $0.30 USD. https://www.paypal.com/cgi-bin/webscr?cmd=_display -receiving-fees-outside [paypal.com]

Re:Good for the customers

[flatcat]

Yea, I actually asked PayPal a policy question once on their defination on gambling. It seems that a website that has a contest that pays in PayPal payments constitute gambling, even though there is no cost for entry. But both PayPal and Ebay have had contests that pay in PayPal payments and this is not gambling. I asked them for a clarification on this and the promptly suspended my account and froze my money for "violation of TOS". An example: Here. [promotionexpert.com]

Re:Paypal has one thing on google...

[Mr.123]

http://www.fatwallet.com/forums/messageview.php?st art=0&catid=52&threadid=478098 [fatwallet.com] Citibank is now offering 5%. FDIC insured and will not lose value like a money market fund.

Re:Customers DON'T pay...

[Zaphod2016]

As a frame of reference: I was charged $0.25 + 2.25% for Visa/MC transactions. Merchants with higher volume can save money over PayPal, but for small fries like me I saw no competitve advantage in keeping a "regular" merchant account (especially after you factor in a monthly fee of ~$25).

I heard many horror stories about PayPal, but so far they've been good to me. And considering the total lack of customer support I got from the "real bank", the support factor was moot (IMO).

Re:End of Paypal ?

[Andrew Nagy]

For the record, if you (the seller) advertises on Adwords, they give you $10 free transactions for every $1 you spend in Adwords advertising. So if you spend $500 a day on advertising costs, they allow $5,000 worth of sales go through for free.

US Only

[ggeens]

The registration form lets you choose a country, but the terms and conditions state that you must be a US citizen. I didn't click on the "I agree" button.

Flashback to the early days of Paypal: Someone pointed me to this new service, and when I get to the registration form, it had "Country: USA" hard coded in the HTML.

Re:End of Paypal ?

[mishkon]

Paypal is NOT 1.9%. It is likely to be around 2.5% (over $3k in sales a month) or 2.2% (over 10k in sales) dpending on volume. many paypal uses pay around 3%. Google being 2% regardless of volume, makes it significantly cheaper then paypal for most sellers.

Re:Customers DON'T pay...

[Anonymous Coward]

Since you asked... My small business [w00tzgames.com] (couldn't resist the shameless plug, sorry) pays about 1.5% + $0.10 per transaction. The actual amount varies based on whether I'm doing a debit or credit transaction.

Re:So if they want to be banks...

[crowemojo]

If they are accepting credit cards, then they must be affiliated with a merchant bank. It is not possible to accept a credit card without this affiliation. If they are considered a Level 1 merchant by Visa, then they have to go through an annual independent PCI compliance review.

A level 1 merchant is defined as the following: [visa.com]
Any merchant-regardless of acceptance channel-processing over 6,000,000 Visa transactions per year.
Any merchant that has suffered a hack or an attack that resulted in an account data compromise.
Any merchant that Visa, at its sole discretion, determines should meet the Level 1 merchant requirements to minimize risk to the Visa system.
Any merchant identified by any other payment card brand as Level 1.

The PCI Data Security Standard [visa.com] consists of twelve basic requirements and is actually very similar to what is regulated at most banks as per FFIEC guidelines. Every Level 1 merchant must have the following:
Annual On-site PCI Data Security Assessment performed by QDSPs that are working for a QDSC (individuals that have been certified to perform the review that are working for companies that have qualified to attest to the compliance to the standards)
Quarterly Network Scan by a qualified scanning vendor. The qualified scanning vendors are screened by Mastercard and are only able to qualify by scanning a controlled environment and producing results that meet the standard that has been established.

Finally, if there are any doubts, PayPal-Verisign is on the published list of qualified service providers [visa.com], indicating that they have complied with the standard I mentioned before as a service provider, not just a merchant.

Re:End of Paypal ?

[Khuffie]

In Canada, you can send money through your bank accounts via email, as long as both of you have access to your bank's online banking. Unfortunately it's something not many people know about.

Re:Paypal has one thing on google...

[bigbigbison]

Check out this blog Bank Deals [blogspot.com]. While a lot of the CD specials on there are for local credit unions, there are also a lot of great online bank deals. Etrade, for example, currently has 3-month CD at 4.75% [blogspot.com] and the longer-term CDs going up from there.

Re:So if they want to be banks...

[Dun Malg]

Question I've been meaning to ask: are debit cards as risky? I'm sure I read somewhere that you can't do chargebacks with them.

Ten years ago, when electronic debit transactions were still new, that was the case. Now most financial institutions offer protections similar to credit cards. That's not to say that debit card protection is as convenient as credit card protection, though. The disadvantage is that, unlike a straight credit card, you start off with the money gone and must wrangle with the bank to get it back. Credit cards, it's the bank that's out the money and you need only refuse to pay.

Correction!!!!

[Zelph]

PayPal charges 2.9%, not 1.9%. The only people who get the 1.9% rate are those who deal over 100,000 PER MONTH.

Use one of the online gold repositories instead

[Colin Smith]

People use PayPal because Ebay demand that they do. Crucially paypal means that you don't have to give bank details to customers/suppliers.

There's e-gold [e-gold.com], GoldMoney [goldmoney.com] etc. They're basically banks, can do instant payments. The difference being you can actually get your hands on the gold.

 

Re:Paypal has one thing on google...

[TheRaven64]

It depends where you are. In the UK, investing Pounds Sterling, it is pretty hard to get anything over 4.5%, even on a relatively long-term investment. The important thing to note here is that the rate of inflation in the UK is around 2% for 2006, while in the US it is 3.7%. This means that you need an interest rate of 3.7% on a US Dollar just for your money to be worth the same amount, while you would only need 2% if your money is in Pounds Sterling (or close to 0% if it's in Swiss Francs).

Re:End of Paypal ?

[Bob Gelumph]

In Australia, they charge you for typing a PIN incorrectly.

They had to dig deep for this charge as they have already been charging for everything else for years.

Re:End of Paypal ?

[sshore]

In Canada, you can send money through your bank accounts via email, as long as both of you have access to your bank's online banking. Unfortunately it's something not many people know about.

It's several dollars per transaction, and it's not offered by all banks. It's no replacement for Paypal et al.

Even better, no minimum Savings up to 4.95%...

[Optic7]

Bankrate.com keeps track of the highest yeld savings accounts in the country [bankrate.com], along with many other rates, like mortgage, credit card, car loan, etc.

PayPal "monopoly" on eBay?

[Anonymous Coward]

There was some speculation posted here on whether PayPal had a monopoly at eBay. Just to clarify, eBay recently created rules limiting forms of allowable payment for eBay transactions. Cutting through the complicated language, here are their rules:

Explicitly Allowed:
The PayPal, CertaPay, and ProPay online services.
Credit Cards and EBT through the seller's merchant account
Bank wire transfers
COD
Cash for in-person transactions only
Checks, money orders, cashier's checks, etc.

Explicitly Prohibited:
Mailing cash
Cash transfer services (Western Union, Moneygram)
StormPay
Any online service not specifically permitted above

Google checkout won't be allowed until if and when eBay chooses to allow it.

Re:1,9% and $0,30 ?

[Drew-NC]

True but it will require a major re-write of my web site, the use of a separate shopping cart software, find a way to move money from google to PayPal (we use PayPal as a checking account too) and upgrading to PayPal Payments Pro at $20 a month. PayPal Payments Standard does not integrate with external shopping cart software, you use PayPal form code and they provide the shopping cart. I expect many small web stores are in the same boat I am in. I remember that not too long ago PayPal required customers to sign up for accounts too. I expect google will change their ways before too long.

Re:End of Paypal ?

[Anawrahta]

Actually it's available to all the chartered Canadian banks. And the cost is $1.50 for any transfer up to $1000 (which is the 24 hour limit). It is FAR cheaper than Paypal or Google Checkout. 2% vs. 1% on any transfer over $150

Re:Interconnected services

[Sanga]

Okay let us create an account B for GBuy; account M for GMail; account T for gtalk; O for orkut. That should work and be compartmentalised. Right?

No. Now OP receives GBuy email in B -- and has to login as B to see what is going on. Wants to hang out on orkut -- logout and login again.

Either do a lot of cookie-editor plugin dancing or just stick to having one GCompartment for all!!