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Ask HN: Why do 37signals and others not accept PayPal?

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Ask HN: Why do 37signals and others not accept PayPal?

#1

Post by egmike »

Hi all,

I've been wondering about this for a while. It seems as though there are a lot of people out there who would prefer to use PayPal to pay for things online, either due to lack of a credit card, or because they already have a PayPal balance from selling things online, or even just because they feel PayPal is secure and/or familiar.

I've searched the 37signals' website and blog for a reason, but didn't find anything, and it seems like others are taking the same approach.

Can anyone shine any light on this?

Thank you.

Re: Ask HN: Why do 37signals and others not accept PayPal?

#3

Post by ramit »

I accept a fairly high volume of payments and intentionally don't accept Paypal. Here's why:

1. 99.9% of my paying customers have a credit card 2. I've only had ~3 customers ever complain about my lack of Paypal. I made a special arrangement for 1. She ended up canceling.

3. Paypal doesn't allow the custom flows (upsells, cross-sells) that I can do with my shopping cart

4. Paypal doesn't integrate as nicely with my backend analytics, and I prefer to have all my sales centralized

5. Hearing bad bad horror stories about Paypal is just another, distant reason why I feel no urge to use them

Hope this helps.

Re: Ask HN: Why do 37signals and others not accept PayPal?

#4

Post by sscheper »

ramit wrote: post #3

I accept a fairly high volume of payments and intentionally don't accept Paypal. Here's why: 1. 99.9% of my paying customers have a credit card 2. I've only had ~3 customers ever complain about my lack of Paypal. I made a special arrangement for 1. She ended up canceling. 3. Paypal doesn't allow the custom flows (upsells, cross-sells) that I can do with my shopping cart 4. Paypal doesn't integrate as nicely with my b…

Makes sense.

What do you use instead of Paypal? Authorize.net?

Also, what shopping cart do you use?

I'm currently using e-junkie, but curious as to what else is out there that works well.

Thanks, Ramit.

Re: Ask HN: Why do 37signals and others not accept PayPal?

#5

Post by ramit »

sscheper wrote: post #4
ramit wrote: post #3

I accept a fairly high volume of payments and intentionally don't accept Paypal. Here's why: 1. 99.9% of my paying customers have a credit card 2. I've only had ~3 customers ever complain about my lack of Paypal. I made a special arrangement for 1. She ended up canceling. 3. Paypal doesn't allow the custom flows (upsells, cross-sells) that I can do with my shopping cart 4. Paypal doesn't integrate as nicely with my b…

Makes sense. What do you use instead of Paypal? Authorize.net? Also, what shopping cart do you use? I'm currently using e-junkie, but curious as to what else is out there that works well. Thanks, Ramit.

I use Authorize.net with 1Shoppingcart. It works pretty well. I'm starting to come up against some technical limitations (like a lack of trigger emails for shopping-cart recovery), but overall, I'm very happy with the solution.

EJunkie and Payloadz are actually very good for simple shopping carts. In fact, they can do some pretty complex stuff like cross-sells and affiliate tracking. When you start finding yourself hitting technical limitations (like upsells not working the way you want them to, or you want to do more complex trials), you'll know it's time to upgrade providers.

Re: Ask HN: Why do 37signals and others not accept PayPal?

#7

Post by mansilla »

I recently stated this in another comment regarding payment systems.. I wouldn't rely on just one. A merchant account through a bank CAN get suspended or put on hold if you trip any risk ratios (e.g. inquiries, chargebacks, refunds). So, indeed, PayPal does have its share of stories of accounts being suspended without explicit reason; however, merchant banks have the same power and believe me when I say that they can lock/suspend your account, and hold your funds for 6 months without ANY detailed explanation and without interest.

Secondly, PayPal does have a new API called PayPal Adaptive Payments. It's very flexible.. pre-approved payments, distributed payments (refunds also mapped backwards), chained payments (multiple source accounts for making payment). Full details on their API PDF docs (easy to understand):

https://cms.paypal.com/cms_content/US/en_US/files/developer/...

So, even if you don't feel all warm and fuzzy about PayPal.. you should have an account handy, and think about having it as a payment option on your site. Some users swear by it because they don't have to share any sensitive credit card information (including CVV coddes) with the merchant.

Re: Ask HN: Why do 37signals and others not accept PayPal?

#8

Post by desigooner »

mansilla wrote: post #7

I recently stated this in another comment regarding payment systems.. I wouldn't rely on just one. A merchant account through a bank CAN get suspended or put on hold if you trip any risk ratios (e.g. inquiries, chargebacks, refunds). So, indeed, PayPal does have its share of stories of accounts being suspended without explicit reason; however, merchant banks have the same power and believe me when I say that they can…

>>Some users swear by it because they don't have to share any sensitive credit card information (including CVV coddes) with the merchant.

I tend to be one of those .. Dispute resolution with Paypal is a much better experience as compared to dealing with, say Bank of America ... I was lucky to have had my paypal account on itunes when I had some fraudulent purchases .. No long claims process as with a bank .. The investigation and the matter was settled within 3-4 days ..

Now I've read about paypal arbitrarily stopping services without any warnings but other banks can be the same..

Re: Ask HN: Why do 37signals and others not accept PayPal?

#9

Post by egmike »

ramit wrote: post #3

I accept a fairly high volume of payments and intentionally don't accept Paypal. Here's why: 1. 99.9% of my paying customers have a credit card 2. I've only had ~3 customers ever complain about my lack of Paypal. I made a special arrangement for 1. She ended up canceling. 3. Paypal doesn't allow the custom flows (upsells, cross-sells) that I can do with my shopping cart 4. Paypal doesn't integrate as nicely with my b…

It certainly does help, thank you Ramit. Have you done any split testing to see if your conversions increase with PayPal though? Any thoughts/data on having PayPal as a secondary payment option, for those who prefer it?

Re: Ask HN: Why do 37signals and others not accept PayPal?

#10

Post by egmike »

desigooner wrote: post #8
mansilla wrote: post #7

I recently stated this in another comment regarding payment systems.. I wouldn't rely on just one. A merchant account through a bank CAN get suspended or put on hold if you trip any risk ratios (e.g. inquiries, chargebacks, refunds). So, indeed, PayPal does have its share of stories of accounts being suspended without explicit reason; however, merchant banks have the same power and believe me when I say that they can…

>>Some users swear by it because they don't have to share any sensitive credit card information (including CVV coddes) with the merchant. I tend to be one of those .. Dispute resolution with Paypal is a much better experience as compared to dealing with, say Bank of America ... I was lucky to have had my paypal account on itunes when I had some fraudulent purchases .. No long claims process as with a bank .. The inve…

Interesting points. I'm leaning towards having PayPal as an option, but I don't think I'd use them as my main provider, at least not for long... Thank you both.
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