Adding to the line up of eBay approved payment processors, Dinesh Lathi, VP Seller Experience announced yesterday that Moneybookers UK will join ProPay USA and Paymate AU to become the third uncompetitive alternative to PayPal. The link provided by eBay leads to an informative blank page saying “coming soon”.
Why am I talking about beards? ProPay, Moneybookers and Paymate are the beard (One who serves to divert suspicion or attention from another - American Heritage Dictionary) eBay suits have donned in hopes of avoiding lawsuits or deflecting charges of violating the Sherman Antitrust Act, Sec.5 of the Federal Trade Commission Act, and Sec.7 of the Clayton Act which regulates exclusive dealing contracts, tying agreements, or requirement contracts. Think of it as a prophylactic (def.5) and you won’t go wrong.
Yet another relatively unknown service provider to US sellers, London based Moneybookers is well established in the highly regulated European Economic Community. A characteristic shared with PayPal is its incredible popularity with the phishing set, but I digress.
Note: All rate conversions quoted here are at today’s rate and are subject to change daily. It is quite possible that Moneybookers will eventually offer a different rate to those currently shown on their website for eBay related transactions, and also that those eBay rates may be limited to Power Sellers.
In brief
Moneybookers is not a bank; does not pay interest on any balances in the Customer account & accounts are not insured by any government agency. Having more than one Moneybookers account is strictly prohibited. You may have up to five email addresses. Moneybookers offers an escrow service which carries a 1% (minimum 2 euro or $2.70 at today’s rate of exchange) fee paid by the buyer.
I strongly recommend you read every word of the Terms of Service. Pay particular attention to Section 5.2, Section 7.4, and Section 11 - Termination.
At first glance Moneybookers appears to be more convenient than PayMate, however the buyer pays to send money (0.5 EUR or $US 0.68) which has never appealed to the US buyer. From their website:
- Once registered with Moneybookers, all you need is your email address and password to make payments.
- You can send money worldwide to anyone with an email address – even if the recipient does not have a Moneybookers account yet.
- Register all your credit/debit cards and bank details with Moneybookers and use them to pay at over 20 000 online shops. This means that you don’t need to provide them each time you want to purchase goods and services online.
- Moneybookers provides a localised service with 12 supported languages and domestic payment options in over 30 countries.
How it works
Personal account:
Moneybookers is very different to PayPal. First, you ‘fund your account’ by ‘uploading money’, to upload money by direct transfer from your bank account is free, to upload money from your credit card will cost you 1.9%. I suspect debit cards may be treated like credit cards but I could be wrong. As mentioned above there is a fee of 1% to a maximum EUR 0.5 ($US 0.68) to send money. Moneybookers really doesn’t want you to withdraw money, that costs EUR 1.80 (($2.42)) for direct bank transfer and a whopping EUR 3.50 ($4.73) by check.
Merchant Account:
Section 12.8 of the Terms of Service would seriously concern me as a merchant, it appears to authorize a EUR 25 charge ($33.58) for refunds or chargebacks. On eBay that would be like adding glue to the screw.
12.8. A bank transfer, direct debit, credit card or any other payment first received by Moneybookers or a merchant of Moneybookers from a Customer and then returned to the originator for any reason - whether upon his own request or by request of his bank or payment provider - will incur an administration/chargeback fee of up to EUR 25 per transaction.
As is increasingly standard in the industry transaction rates vary according to monthly volume, scaled from 1.9% for volume under EUR 1500.00 ($2015) to 0.9% for volume exceeding EUR 100,000 ($1,343,363.78); there is an additional EUR 0.29 ($0.39) per transaction fee.
It appears Merchant accounts also pay a flat rate EUR 1.80 ($2.42) fee per bank transfer withdrawal. Interestingly Moneybookers offers a ‘chargeback insurance’ rate at a cost to the merchant of a mere 6.9% to 7.9% per transaction. Nice truck!
Moneybookers has an affiliate program which could provide an additional income stream for sellers.
Y’all come back!
Go Figure - UPDATE January 10th 2009
An announcement is made on eBay.com, the USA site, that Moneybookers is now an approved payment processing provider. A US resident registering with the service receives the message shown on the left. Please click the image to enlarge.
You know, I have to tell you, I really enjoy this blog and the insight from everyone who participates. I find it to be refreshing and very informative. I wish there were more blogs like it. Anyway, I felt it was about time I posted, I?ve spent most of my time here just lurking and reading, but today for some reason I just felt compelled to say this.
Posted by Aaron Wakling on January 9th, 2009.
G’day Henrietta,
If I follow the link to “payment options in over 30 countries”, I note that there is no specific mention of the United States of America, although there is “For ALL Countries - International”.
Discussion at Tamebay prompted me to look for this. The responses to the Tamebay blog post “eBay. com allow Moneybookers, Paymate” indicate that MoneyBookers is not accepting new accounts from the United States, allegedly due to “The reason being Moneybookers allows transfers to/from online casinos.” which is apparently banned in some areas of the USA.
It is also claimed “As to a buyer refund or buyer protection policy, Moneybookers specifically don’t have one. All disputes are between buyer and seller; Moneybookers is just a payment service.”
I assume that the latter part will be updated, at least for Ebay, by MoneyBookers, as not doing so would remove Ebay’s charade that all of the payment changes are designed for consumer protection, which is not offered by cheque, money order or direct bank deposit.
I will follow up on my paranoid rant from yesterday here, and suggest that Ebay has now set up alternative online payment services for both the UK and Australian markets. I do believe that this is a pre-emptive move to try to force restrictions to payment option on both the Australian and UK sites in the coming year.
Beards indeed!
Kevin
Posted by Kevin_T on January 9th, 2009.
G’day Kevin
Moneybookers TOS Section 6.6 “Furthermore, it is strictly forbidden for citizens or residents of certain countries such as but not limited to the United States of America, Turkey, China, Malaysia or Israel to send payments to websites offering gambling services such as sports betting, casino games and pokers games. Moneybookers reserves the right in its own discretion to amend the list of countries where it is prohibited to send payments to gambling activities as described above.”
Interestingly porn which eBay welcomes, (although precisely how buyers pay for the stuff is a good question) is somewhat banned in the same section.
Posted by Henrietta on January 9th, 2009.
Fascinating update. It really undermines the credibility of Ebay’s efforts to offer payment services as “alternatives” to PayPal on the Ebay.com site.
This will be worth watching as it evolves - and I am sure that it will evolve.
Kind Regards, Kevin
Posted by Kevin_T on January 10th, 2009.
Quote: The link provided by eBay leads to an informative blank page saying “coming soon”.
If this was the link you were referring to, it now has some information:
http://www.moneybookers.com/partners/us/ebay/
The disclaimer at the bottom of the page suggests (a) that the Ebay.com enterprise is a separate US registered entity, and (b) that they are covering themselves against delays in starting already (not really surprising since they couldn’t even assemble this page by the time that the announcement was made) :
“LEGAL NOTICE: Moneybookers payment services through eBay are offered by Moneybookers USA, Inc. (Moneybookers). Moneybookers payment services are subject to service terms and conditions. Moneybookers payment services consist of credit and debit card payments processing for purchases of goods and services from merchant customers and card information storage services for buyer customers. Moneybookers does not offer a stored value account feature and may not be used for payments unrelated to a purchase of goods or services from merchants. All pricing statements on this webpage are subject to change by Moneybookers without prior notice to users or potential users. Moneybookers shall have no liability to any person in the event that the commencement of the payment services in the United States is delayed beyond February 2009.”
Oh, and “Registration on Moneybookers starts soon.”
Ahem.
Kevin
Posted by Kevin_T on January 10th, 2009.
MONTHLY SALES PRICE PER TRANSACTION
_
$0.00 - $3,000.00 = 2.9% + $0.29
$3,000.01 - $10,000.0 = 2.4% + $0.29
$10,000.01 - $100,000.00 = 2.1% +$0.29
> $100,000.00 = 1.9% + $0.29
Cheaper than PayPal and as a seller, that’s what concerns me
I’ve used MoneyBookers for 6 years and never had any problem at all with them.
Ed
Posted by Ed on January 10th, 2009.
[...] have long been my favourite PayPal alternative (although Henrietta at RedInkDiary appears to have a vitriolic distrust of them - I wonder if she’s ever tried using them?), and these results are fantastic news for both [...]
Posted by Sunday Papers 11 Jan 2009 - BuildaSkill.com on January 10th, 2009.
Hi Ed,
If I understand from your blog correctly, you are not in America. The rates you have quoted are
“Moneybookers Rate Card US Domestic“.
At this stage, this doesn’t give the rates for international transactions. It may well be cheaper than PayPal, but we are yet to get the detail.
Kevin
Posted by Kevin_T on January 11th, 2009.
Yes Ed, Henrietta tried using them and was miserably rejected. You see, Moneybookers says “We currently do not accept customers from your country of residence. Please accept our apologies for the inconvenience”
Although the transaction rates Ed has quoted are competitive with PayPal, the fee for withdrawal from the account which I quote from the only rate chart available to me, from the public website, is not.
I am appalled that Moneybookers, which makes money on the non interest bearing float (my funds) will then charge me a hefty fee to withdraw those same funds. PayPal in contrast currently pays 1.18% interest on funds with a Money Market account and does not charge for withdrawal.
Neither is competitive in price or convenience with Google Checkout at 20c per transaction plus 1.9% which automatically sweeps funds to my bank account, usually within 48 hours. It is strange (not) that PayPal funds take 4 - 5 business days to accomplish the same transfer while claiming that the delay is caused by my bank.
At this point in time Moneybookers is not an alternative for US merchants. If terms and conditions change, as happened with ProPay I will review the service again.
Posted by Henrietta on January 11th, 2009.
Quote: “PayPal in contrast currently pays 1.18% interest on funds with a Money Market account and does not charge for withdrawal.”
PayPal in Australia charges $1.00 for any withdrawal of less than AU $150.00.
In PayPal’s favour (a rare thing from me) I will say that while they advise that it will take 4 to 5 working days to transfer into my account, if I withdraw funds on a Monday evening, they will be in my Australian bank account by Wednesday morning.
Sorry to dominate your comment section at the moment.
Kind Regards, Kevin
Posted by Kevin_T on January 11th, 2009.
Any comment which adds to the discussion and to the sum of my knowledge is welcome on my blog.
I didn’t know PayPal charged for withdrawals under $150 in Australia, that would hit the smaller seller right in the gut. No wonder there was such a galvanic response to PayPal Only in Australia.
I saw the light last month. eBay, while welcoming the fees paid by small sellers (my definition of that has previously been non PowerSellers) does not regard them as sellers at all. You must be a PowerSeller to be an eBay seller so perhaps I need to revise my definition. Micro-sellers; sell less than $US1000.00 or 100 items per month and they don’t count.
As ProPay is just now getting around to allowing Bronze PowerSellers to use their service maybe they are the new small sellers?
Posted by Henrietta on January 11th, 2009.
There is some speculation that eBay intends to essentially close some (or all?) of their non-US sites, and simply bundle them into the main site. This would allow eBay to avoid pesky local laws and also cut down on some staff and paperwork, etc.
Ebay New Zealand points directly to the main U.S. site, though it was once an independent site. There is some speculation that this is going to happen to the Australian site (especially with recent announcements from eBay about altering categories to “improve sales” on the AU site, but which, coincidentally, would allow better integration with the US site).
Posted by bonni on January 11th, 2009.
Yes Bonni - the announcement regarding this month’s HUGE category changes on the AU site, specifically states it is to align the categories with the UK & US sites - when I inspected the specifics of the changes, my first thought was “Bye bye eBay.com.au” they are that significant. I have been waiting for AU to go the way of NZ since the ACCC overturned the PayPal only policy application.
Other eBay moves around Asia-Pacific also point to the smaller sites being pulled back to the US parent too. India might survive, but I think all the SE Asian sites will go.
… Back to MoneyBookers
MoneyBookers UK site is suffering page not available errors (something I’ve never seen before - must be due to overload on the back of the announcement) the home page loads OK, but I’m having a devil of a job getting to the login page.
CURRENCY CONVERSION FEES
For transactions involving currency conversion Moneybookers adds 1.75% to our wholesale exchange rates for foreign currency. This charge serves as a protection against the volatility and risk associated with FX markets. The Moneybookers exchange rates are updated on a regular basis throughout the day.
UPLOAD & WITHDRAWAL FEES
For ALL Countries
Upload Funds
- via SWIFT = Free
- via Credit Card = 1.9%
Withdraw Funds
- via SWIFT = GBP 1.60
- via Cheque = GBP 3.20
Note that although it says all countries, there are different fees for the list of 30+ countries
e.g.
All funds uploads in the UK are free.
Withdrawals in the UK are GBP 1.60 to bank or Visa Debit account and GBP 3.20 by cheque.
The withdrawal fees are flat processing fees - whether you with draw 1 penny or a million pounds, they are the same flat fee.
The 3 withdrawal routes (bank / cheque / visa) have identical fees for all named countries and I do not expect that to change for the USA. Not every route is available in every country (e.g. China can only send funds, not withdraw to local accounts, and Australia cannot withdraw to visa accounts (but can do so to bank or by cheque)).
Overall, the no chargebacks system saves money for sellers, the option to have buyers split or pay the receiving fee saves sellers money (it IS optional - sellers choose the way they want to run it), and at the end of the day, it is up to the sellers to decide how to mitigate the withdrawal fee by withdrawing small amounts or saving up for a large amount.
Remember, MoneyBookers is far more popular than PayPal not just in Europe, but also in developing countries too - exactly the type of territories where you want the comfort of that no-chargebacks policy. (I have no qualms about accepting MoneyBookers from Nigeria, but if I ever think of accepting PayPal from there …. well, just shoot me and put me out of my misery).
btw - PayMate have confirmed in a press release 2 interesting points -
Only US and OZ residents can/will be able to receive payments via PayMate
Buyers will not need a PayMate account to pay by credit/debit card via the PayMate interface and payments will automatically be sent to receivers bank accounts (a-la-Google Checkout style).
MoneyBookers requires both sender and receiver to have a MoneyBookers account - that is their major drawback, but then PayPal also requires that after Buyers have sent their first payment (i.e. for 2nd and subsequent payments through PayPal).
Ed
Posted by Ed on January 11th, 2009.
[...] Buyer-collect, non-electronic payments, transactions, ProPay, and BillMeLater, were only the opening salvo of a full scale broadside to drive back the noise from sellers outraged at having PayPal forced on them in a tying strategy that is in direct contravention of the Sherman anti-trust Act. [...]
Posted by LieBay and the uneven PayPal-alternatives playing field - BuildaSkill.com on March 6th, 2009.