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eBay to Act As Escrow Agent in Certain Categories and with Certain Sellers!
eBay recently announced significant changes to the site. Many of these changes have been discussed on forums and discussion boards both on and off of eBay in GREAT detail and in large numbers! One of the changes that has not received the attention that it deserves is the Safer Payments requirements. The very basic premise to this change is that PayPal (eBay in essence) can decide to withhold a sellers money for up to 21 days in certain situations.Let's take a look at this.
eBay is set to put in place requirements and restrictions of certain sellers who sell in certain "higher risk" categories.
Sellers will be required to offer safer payment if they meet any of these conditions:
have more than 5% dissatisfied buyers in the last 30 days
have a feedback score of less than 100
These categories (and sub categories) include: gift certificates, video games, cell phones, computers and consumer electronics.
If you are required to offer a safer payment option, you might also be subject to holds on payment. PayPal may hold payments for the sale of an eBay item until the earliest of the following occurs:
the buyer leaves positive feedback,
3 days after confirmed item delivery* or
21 days without a dispute, claim, chargeback, or reversal filed on that transaction.
* This applies to US domestic transactions that are shipped by USPS or FedEx and either (i) use PayPal shipping labels to ship items or (ii) upload tracking information to PayPal via the transaction details page.
How are dissatisfied buyers measured? At eBay we consider a buyer dissatisfied if any of these occurs:
The buyer leaves a seller a Detailed Seller Rating (DSR) of 1 or 2 on any of the attributes
The buyer files a dispute, claim, or chargeback related to "Item Not Received" (INR) or "Significantly Not as Described" (SNAD)
Buyer leaves negative or neutral feedback
eBay has apparently decided to act on behalf of the buyer as an Escrow Agent in these cases. I did some quick research on the eBay site and found that of the Top Five eBay Store sellers as listed today on eBay Pulse Consumer Electronics category, all may be required to offer Safer Payments ( they already do) but they might also be subject to the hold on payments based on their neutrals and negatives combined with their Detailed Seller Ratings (DSR's).
The only way I can compare this change in policy to every day brick and mortar business is this: I as a customer or buyer walk into your place of business, select the item I am interested in, and walk out with this item, telling you the business owner, "If I am happy with this in 21 days, I will pay you."
eBay says they will monitor the site and watch for buyers who habitually file complaints to receive refunds, and additionally rely on sellers to report these situations. In the meantime, sellers will not have received their payments until eBay reviews the situation and acts. Given eBay's Customer Support and Trust & Safety history in responding to complaints (on both the buyer and seller side) this will mean days, weeks or months of turmoil for sellers. Imagine a seller telling their suppliers they will have to wait for payment for up to 21 days until eBay releases their monies! Imagine telling eBay that they will pay their eBay bill 21 days late! How about telling eBay, we will pay you when you pay us????
Oh yeah, one more thing,,, remember sellers will not be able to leave negative feedback for these buyers so other sellers won't know about previous problems!
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