[pchelpers] Re: another one

Hi Cy

>>> Well, according to what i've heard about PayPal, it is not a smart idea 
>>> to use PayPal, especially as a merchant. See 
>>> http://www.paypalwarning.com/home
>>> http://en.wikipedia.org/wiki/Paypal#Criticism
>>> http://www.free-merchant.com/

> I hope this is not OFF TOPIC. The Internet makes it really easy for 
> disgruntled persons to possibly slander a company.  From what I read in 
> the Paypal warning web site, the input does not seem to be verified. 

I'm sure this is not off topic. In using our computers to pay, we are 
often given only the choice to use PayPal or sometimes other more 
complicated or old-fashioned means, and it is therefore important for 
list members to know if there are any problems associated with PayPal. 
Just because you and Pc haven't had problems with PayPal does not 
guarantee that you might not at some point in the future, and it's 
important for you and all list members to know if PayPal is known to 
deal with problems fairly and openly.

Since PayPal is a near monopoly, it can afford to ignore customers with 
problems, and this can be quite horrible for the individuals concerned. 
Not only can they be faced with financial loss; they can even be 
deprived of the most common means of paying and receiving money over the 
Internet. This means becoming pariahs, which can be devastating. 
Therefore a near monopoly has a special obligation to try to resolve all 
issues with customers and to not try to increase its profits obscenely 
by not employing enough people in customer service. And that PayPal 
doesn't have enough customer service employees and therefore sends out 
ridiculous automated responses is so well documented that it's even in 
Wikipedia.

And if the stories of people being hurt by PayPal are in fact 
exaggerated or even slander, they will not hurt the company much -- and 
not just because it is a near monopoly. If PayPal were just a big 
company that had to worry about dishonest stories making customers go to 
competitors, they would be getting just as many new customers leaving 
the competitors due to other crackpots telling dishonest stories about 
the competitors. In fact, there are no (longer any) real competitors, 
and PayPal can afford to and apparently does not care about either real 
or dishonest stories about problems.

And if PayPal were not a near-monopoly, it would not be known for bad or 
callous customer service and would not create so many disgruntled or 
even angry customers. Any big company of course also attracts dishonest 
people, vultures looking for prey and trying to extort or blackmail. 
However, not all of the stories of people with blocked accounts and 
PayPal's callous attitude towards the problem sound like pure fiction or 
lies. Even a big company should not take the attitude that destroying 
even one little person's little business is not a big deal. It's quite 
understandable that merchants whose funds were blocked for a long time 
and therefore lost many customers or went bankrupt are very angry and 
for a long time. If PayPal were not a monopoly, they would surely give 
these people a generous compensation to stop them retelling their 
stories. Then only crackpots and criminals would be left, and the 
stories would sound much more far-fetched.

> Pay 
> Pal is like any other company. If there is a real case for a fraud claim 
> they can be sued.  I also have used it for years and have never had 
> problem 'one'.

Apparently PayPal is not like any other company. First of all, it's a 
near monopoly and therefore the normal free market's mechanisms don't 
exist that prevent corruption and customer abuse much more effectively 
than the government or courts can. Secondly, we are talking about a new 
technique to transfer funds that most people have not yet understood. If 
people and especially self-employed people were aware that the money in 
their PayPal account belongs to PayPal until PayPal decides to give it 
to them, they would be much more wary and would demand that legislation 
and courts severely restrict the amount of time that PayPal can block 
accounts. Basically, the problem is simple. PayPal acts like a bank but 
is not *yet* subjected to the strict rules and laws regulating banks. 
These rules and laws were developed to protect little people and 
businesses against powerful banks, and similar ones should be applied to 
PayPal as well.

As far as i know, the problems most people have had with PayPal are not 
fraud or in fact blatantly illegal activities by PayPal. It seems that 
PayPal just doesn't bother to have enough employees to deal with blocked 
accounts in a reasonable amount of time. PayPal is abusing the freedom 
of the wild west they've discovered by acting like a bank without 
formally being one while laughing at the fusty regulators and 
legislators, who will take a few decades to react.

By the way, this is a typical phenomenon in the world of computers and 
IT where consumer protection agencies and legislation are much too slow 
in adapting to changes. In fact, Microsoft's criminal and immoral 
invention of putting products on the market before they are tested and 
ready is now spreading even to household appliances and cars. Unless 
consumers reject their current role of unpaid product testers and 
developers, things will continue to get worse.

Although the Internet provides companies with completely new methods of 
making record profits in record time, it also consists of millions of 
individual computer users who can tell each other about problems. We do 
not have to worry about big companies like PayPal perhaps losing some 
money due to dishonest stories. On the contrary, we have to be 
interested in the stories of individuals perhaps honestly claiming they 
were treated unfairly by a huge and unregulated company because even 
(and especially) if there are only few such individuals, their plight 
can be horrible. Big companies are very often interested in problems 
only if they affect enough people to affect their profits unless the 
victims shout and unless other people show interest in the victims' 
plight. The modern and rational method of lodging a complaint with a 
consumer protection agency doesn't usually work in any country yet. And 
small businesses still don't even have a corresponding place to turn to 
for help.



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