eBay and PayPal Finally Break Up for Good

Illustration for article titled eBay and PayPal Finally Break Up for Good
Photo: Martin Bureau (Getty Images)

It looks like the nearly two-decade-long relationship between eBay and PayPal has quietly come to a close.

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On Monday, the auctioneering giant quietly updated its terms of service to let sellers know that pretty soon, any funds they rake in will no longer be credited to their PayPal account. If sellers want to keep getting paid, any funds will need to be deposited directly into their bank account.

“When eBay manages payments, you can sell and get paid in one place, on eBay, without a need to pay third party processing fees,” the company wrote in an FAQ about the update. What eBay neglects to mention is that these managed payments come with a brand new processing fee from eBay—$0.30, plus a certain fraction of whatever price an item ultimately goes for. That said, the company’s promising sellers that whatever cut eBay ultimately takes will usually be lower than the roughly 13% they’re currently forking over to both eBay and PayPal combined.

On one website page explaining the new program, eBay noted that the deadlines for all users are “phased.” Some sellers are being told to swap out their PayPal login with the details from their checking account by midnight on June 1. Others, eBay says, will get communication from the company sometimes before the year’s end.

This news shouldn’t be too much of a shock to anyone that’s followed the eBay/PayPal saga up until this point. When PayPal was officially spun out from its longtime parent in 2015, it was with the agreement that it would keep managing payments for a five-year transition period. In the leadup to that fateful day, eBay began rolling out beta versions of an eBay-owned payment processor in 2018. Towards the end of last year, the company claimed that about 340,000 sellers were opted into eBay’s new payment platform.

Reviews so far are... mixed. Some sellers have complained that these new direct deposits can take up to a week instead of the two days that eBay’s been promising. Others have reported their deposits freezing altogether. Hopefully, eBay fixes that hiccup before Managed Payments become mandatory for everyone.

I cover the business of data for Gizmodo. Send your worst tips to swodinsky@gizmodo.com.

DISCUSSION

mystixa
mystixa

Ebay has managed to make something that should be irrelevant into an additional pain. They could have made it so new users started on the new system. Or they could have come up with a ‘system’ (really its a lack of system) that actually competed to give benefits instead of just deciding to switch things selfishly and forcing their customers to come for the ride.

Ebay is playing the ‘too big to fail’ so we may as well squeeze our people a bit more. This works fine for a while but carries with it the additional risk when a newcomer to the market comes on the scene.

We have longer waits, at BEST equal pay to the user but sometimes worse, and alienation from a known evil. No Paypal wasn’t perfect but we’ve become familiar with how that system works and where it becomes risky. Ive been an ebay seller for many years and I will happily jump ship when competition arrives and from Ebay seller forums I know I’m far from alone. Thats a significant problem for future Ebay.