Popular Payment Services Used On Ebay
Online payment services started as a “virtual” cash transaction system using “fake” digital money about 15 years ago. This quickly evolved into using real money, which was generally tied to a credit card transaction not very different than what you do for mail order. Stores and catalog retailers generally have “merchant accounts” with credit card processors. The online payment services enable anyone to “take” credit cards, for fees like most small business merchant account rates, around 1 to 4%. Online payment services have gotten more diverse as technology has evolved – you can now link multiple bank accounts as well as multiple credit cards to, for example, a PayPal account. Today, the online payment services function like banks, which some of them also actually are.
When you sell something on eBay, and you receive payment via PayPal, the buyer may have paid by cash or credit card, and the net amount, minus fees, is deposited into your PayPal account. From there you can pay for something yourself directly, withdraw the money on an ATM or credit card, transfer the money into another account, or have a check sent each month.
Most online payment services are very much like PayPal, with a fee structure aimed at the recipient of the money, but there are exceptions. BidPay, which is owned by Western Union, is a form of virtual money order and is also popular on eBay. Unlike PayPal and most other services which charge the receiver of the payment, BidPay, like its parent, charges the sender of the money.