Need Paypal Alternatives
May 3, 2013 1:14 PM   Subscribe

I have a "Donate" button on my web site, but people are using it against me. Are there any seller/money recipient friendly money sites like Paypal?

I have a web site where we take donations. However in the past month two people have gamed the system to use this to HURT me. One person donated twice then did a credit card chargeback on one causing Paypal to not only take back the money but saddle me with a $20 penalty for an action in which I had no part. Then I sold items, had a tracking number prooving I shipped the items, but Paypal STILL took the money away from me.

I wondered if Paypal is "the only game in town" so they have me by the balls, or if there are alternatives that can get me away from this draconian pseudo-bank.
posted by arniec to Work & Money (10 answers total) 10 users marked this as a favorite
Dwolla. Or if you want to roll your own then Stripe or Braintree.
posted by tracert at 1:27 PM on May 3, 2013 [1 favorite]

You will not be able to avoid credit card chargebacks regardless of the processor unless you switch to a non-credit form of payment (like ACH transfers). The only difference is the amount of the fee (you might be able to get it down to $10 or so) and the likelihood you win the dispute (this likely won't change much; credit card processors are legally obligated to be heavily biased towards consumers). You need to build these costs into your expected expenses as part of managing your website.

Anecdotally, I've heard good things about Intuit Merchant Services and Costco/Elavon Processing. However, both of these are somewhat oriented partially towards physical locations, so you can probably find better online-only options.
posted by saeculorum at 1:29 PM on May 3, 2013

There are multiple HN discussions on this topic.
posted by Michele in California at 1:30 PM on May 3, 2013

Would Popmoney work for you?
posted by Ruthless Bunny at 1:34 PM on May 3, 2013

If you're looking for tipjar-style donations, there's Flattr. It does need you to maintain some donations yourself, though.
posted by scruss at 1:35 PM on May 3, 2013

Square is another one.
posted by Dansaman at 2:03 PM on May 3, 2013 [1 favorite]

I'm not sure your donor was trying to hurt you. Is it possible they only intended to donate once, and then did the chargeback when they realized they'd accidentally done it twice?

How can there be a chargeback on a donation, anyway?
posted by musofire at 2:31 PM on May 3, 2013

Unless Paypal's just ignoring the chargeback adjudication procedures (which wouldn't surprise me one bit), you're supposed to be able to dispute the chargeback.

As I understand it, the customer is supposed to present a substantive claim to their credit card provider, and the substantive claim needs to indicate, among other things, a good-faith effort to gain adequate recompense directly from the merchant, which is to say, they should've contacted you to request a charge reversal before filing for a chargeback.

The intermediation of Paypal muddies the waters, alas, since technically they're not merely facilitating the credit card purchase, but are in fact serving as the merchant from the buyer's POV and then providing you with money, so it might be Paypal, and not you, who the card issuers recognize as the "merchant". And seeing as how it isn't their money, Paypal doesn't actually have any incentive to fight the chargeback, or even to pass on to you any sort of recourse.

A credit card processing service which doesn't intermediate to this degree in the handling of the money (i.e. one which doesn't co-opt your role as merchant) would probably make handling your own defense in such cases easier.
posted by jackbishop at 3:53 PM on May 3, 2013

Square is for physical transactions (card swipe or manual entry) only.
posted by drwelby at 6:43 AM on May 4, 2013

Stripe really does seem to have a great program because the rates are very low even though they are non-swipe (I don't know how they charge the same for Amex and Visa and Mastercard), simple and straightforward (no setup fee, etc.), and transparent (with credit card processing you have to watch out of up-charges and hidden fees for things like reward cards, government cards, business/corporate cards, international cards, address mismatches, and who knows what else, and sometimes all that information is impossible to decipher on a merchant statement - with Stripe it seems none of these things need be of concern).
posted by Dansaman at 9:37 AM on May 10, 2013

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