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Why would big launches won't offer Paypal?

by Andy Immotna
30 replies
I run across Eben Pagan's course and was desperate
to buy but they would not allow Paypal payment option...
I even offered full payment of $1997 but the staff refused as
they don't have Paypal account.

One of PP option's advantage favors international customers...
Because it saves them some cash on currency conversions..

In my case, I'm not US based but my revenues/sales
are passing thru Paypal in US currency. And those funds are used
for my purchases. Payment of high ticket items such as $2000 would
be seamless but for credit card,

1. I have to withdraw a $2k Paypal fund to my local bank account
thus currency conversion occurs = 1st instance of losing value of my money

2. Next, I then had to pay my bank issuer in my local
currency the $2k equivalent. Then fund is converted again
into US currency in the process of purchasing the product.
~~> (2nd conversion occurs which reduces again the monetary value of the fund)


For future big ticket product launchers, I bet most of your
international customers would not afford to lose some moolah in the conversion
process ...UNLESS they don't have Paypal funds.

I'd suggest getting ready for a Paypal account to receive payments on your next
big launch or if you're afraid of the Paypal horror stories, 2Checkout now offers Paypal option.. Unless my case is isolated. :rolleyes:

However the advantage of using my plastic is the point
accumulation for rebates but I would prefer saving the actual cost!
#2checkout #big #launches #offer #payment gateway #paypal #paypal payment option
  • Profile picture of the author bgmacaw
    When you're selling items under about $200 it makes sense to use PayPal. Once you get higher than that, it starts making less and less sense and once you top $1000 per transaction it doesn't make any sense at all.

    Why? Two main reasons...

    PayPal is an expensive payment processor. It's great for the little guy since it's easy to get approved and you can use it anywhere you want as long as you're within their rules. But, the fees are high and if one has a better option for payment processing it makes financial sense to use it instead.

    PayPal rules tend to become more troublesome on higher dollar value transactions. They come under more intense scrutiny from PayPal for both compliance with PayPal's internal rules as well as from US anti-drug and anti-terrorism laws related to money laundering. It's no fun having a product launch shut down because PayPal freezes an account because it got over $10K in payments in 'suspicious' $1997 chunks in an hour. Since they don't vet their merchants closely they enforce their rules more tightly than processors who make it much more difficult to get an account.
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    • Profile picture of the author Andy Immotna
      Originally Posted by bgmacaw View Post

      When you're selling items under about $200 it makes sense to use PayPal. Once you get higher than that, it starts making less and less sense and once you top $1000 per transaction it doesn't make any sense at all.

      Why? Two main reasons...

      PayPal is an expensive payment processor. It's great for the little guy since it's easy to get approved and you can use it anywhere you want as long as you're within their rules. But, the fees are high and if one has a better option for payment processing it makes financial sense to use it instead.

      PayPal rules tend to become more troublesome on higher dollar value transactions. They come under more intense scrutiny from PayPal for both compliance with PayPal's internal rules as well as from US anti-drug and anti-terrorism laws related to money laundering. It's no fun having a product launch shut down because PayPal freezes an account because it got over $10K in payments in 'suspicious' $1997 chunks in an hour. Since they don't vet their merchants closely they enforce their rules more tightly than processors who make it much more difficult to get an account.
      To play safe, how about using 2Checkout? I think the charges/ fees are almost the same as to having your own CC processing system...

      2Checkout accepts credit card transactions and recently Paypal. I think you won't need to have a Paypal account to receive Paypal payments thru 2CO as funds are wired to your bank account or sent to you through check.
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  • Profile picture of the author Lightlysalted
    I would allways use PayPal for transaction under $100 but for me anything over that doesn't add up. Essential PayPal is the "poor mans" payment processing system designed for those who perhaps can't afford to invest upfront in credit card technology or shopping baskets. But if you can then in the long term it's much cheaper than PAYPAL.
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  • Profile picture of the author josefnew
    This is all news to, though I have not bought things online more than $200 before anyway.
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  • Profile picture of the author Dana Forsythe
    Thats an expensive course..
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  • Profile picture of the author jasonvthomas
    Paypal is definitly risky to deal with large amounts. Suddenly large amounts starts to credit in your account and they will view your account suspiciously and may even put it on hold, causing you numerous phone calls and no access to your account too. They have done this to many users who have been with them for a long time.
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    • Profile picture of the author Charlie Parker
      Probably because with paypal you won't go through the funnel as its been designed with the automated 1 click upsells and automated backend system.
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      • Profile picture of the author Andy Immotna
        Originally Posted by Charlie Parker View Post

        Probably because with paypal you won't go through the funnel as its been designed with the automated 1 click upsells and automated backend system.
        That's one downside though...
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    • Profile picture of the author Korey Carter
      This is the same if you have a merchant account and payment gateway system though. Payment processors have to be very careful to keep the portfolio performing properly. I have one bank I work with that won't setup a merchant account if the average ticket is above $400. I know it is a different qualification with PayPal if the average ticket is above $1000.

      Both of them require track records and trust built with the processor.

      I would think Eban has both but he is missing alot of sales by not accepting PayPal. I always say it's too hard to get them to your offer and then not give them their favorite method of paying.

      I suggest people accept a combination of credit cards direct (could either be PayPal Pro or a merchant account and payment gateway), PayPal business transactions and Google checkout. If you offer them all then you have happy customers that buy because you accomodate them.
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      • Profile picture of the author Andy Immotna
        Originally Posted by Ecommerce Guru View Post

        This is the same if you have a merchant account and payment gateway system though. Payment processors have to be very careful to keep the portfolio performing properly. I have one bank I work with that won't setup a merchant account if the average ticket is above $400. I know it is a different qualification with PayPal if the average ticket is above $1000.

        Both of them require track records and trust built with the processor.

        I would think Eban has both but he is missing alot of sales by not accepting PayPal. I always say it's too hard to get them to your offer and then not give them their favorite method of paying.

        I suggest people accept a combination of credit cards direct (could either be PayPal Pro or a merchant account and payment gateway), PayPal business transactions and Google checkout. If you offer them all then you have happy customers that buy because you accomodate them.
        Yeah, I agree.. In the end what you would want to build is a happy customer!

        If you would not prefer Paypal, just not post the purchase link on the frontend. Just your payment processing system..

        And in case someone asks for a Paypal method, just give them the link!

        I bought Niche Socializer at $997 and they did that for me! = Happy customer!
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    • Profile picture of the author Andy Immotna
      Originally Posted by jasonvthomas View Post

      Paypal is definitly risky to deal with large amounts. Suddenly large amounts starts to credit in your account and they will view your account suspiciously and may even put it on hold, causing you numerous phone calls and no access to your account too. They have done this to many users who have been with them for a long time.
      Yep, I had my account shut down in the past but on the succeeding launch I made, I called them and notify them in advance that I will be expecting a certain level of cash flow -and that they won't flag my account as doing unusual activities.

      The person I talked to was accommodating and indeed posted a note on my Paypal account. I called again another agent to confirm and I was told the note was in place.

      And with that, I didn't have any problem with the sudden surge of funds in my account.

      It's wise thing to call them before you're going to a launch if you're going to use their system.
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  • Profile picture of the author BillOliver
    Ray Johnson has written an ebook called "My eBay & PayPal Nightmare"
    I personally would look for every form of payment OTHER than Paranoid PayPal!

    Bill
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    • Profile picture of the author JohnMcCabe
      Have you considered, if it's available to you in your country, getting a PayPal debit card? Then you could use it on anything you like, just like you would a MasterCard...
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      • Profile picture of the author JaniG
        with paypal, they sometimes freeze your acount when you sell things in the make money niche.

        i got my paypal frozen and still have $4k stuck in there from 1 year ago..

        Why do you keep so much in yoru paypal anyway ?

        shoudnt you just transfer it to your bank and have your paypal linked to your bank to make purchases aswell ??

        that would of allowed you to buy it instead of now having to transfer it and wait.
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        • Profile picture of the author Andy Immotna
          Originally Posted by teamfire View Post

          with paypal, they sometimes freeze your acount when you sell things in the make money niche.

          i got my paypal frozen and still have $4k stuck in there from 1 year ago..

          Why do you keep so much in yoru paypal anyway ?

          shoudnt you just transfer it to your bank and have your paypal linked to your bank to make purchases aswell ??

          that would of allowed you to buy it instead of now having to transfer it and wait.
          I have my sales go there however every end of month, I do withdrawals.

          Purchasing using Paypal bank transfer feature is not yet available in paypal PH. ;(

          Anyways,

          $4k stuck for a year now? I thought the clearing period is 6 months. I had 2 accounts frozen previously in different times and exactly 6 months, the funds were released but the accounts were still locked though.

          You may try calling giving them a call with regards to your account.
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      • Profile picture of the author JaniG
        Originally Posted by JohnMcCabe View Post

        Have you considered, if it's available to you in your country, getting a PayPal debit card? Then you could use it on anything you like, just like you would a MasterCard...
        Very True!
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      • Profile picture of the author Andy Immotna
        Originally Posted by JohnMcCabe View Post

        Have you considered, if it's available to you in your country, getting a PayPal debit card? Then you could use it on anything you like, just like you would a MasterCard...
        Unfortunately, it isn't yet available...
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  • Profile picture of the author consult4u
    paypal with it's very very liberal return policy being so buyer slanted, it is to easy for a buyer to file a claim after the seller has delivered the goods and get a full refund for the big launch guys it is just not worth the headaches.
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  • Profile picture of the author monovax
    Yes, you can use paypal or third party debit cards to transfer funds and pay with paypal money. At least that is what I usually do.
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  • Profile picture of the author Sheryl Polomka
    I wouldn't use Paypal for a launch. I used them to run a WSO and had my account closed, due to high risk or unusual activity - I think it was because of the sudden increase of funds coming in from the WSO.

    That was only a small WSO with a $17 product, imagine if you launched a high priced product and they decide to close your account because of the sudden increase in funds. True, after a few weeks you will probably get your account opened again if you can prove that you are legit, but in the meantime your launch is screwed because your payment processor is no longer accepting payments from you.
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    • Profile picture of the author JaniG
      Originally Posted by Sheryl Polomka View Post

      I wouldn't use Paypal for a launch. I used them to run a WSO and had my account closed, due to high risk or unusual activity - I think it was because of the sudden increase of funds coming in from the WSO.

      That was only a small WSO with a $17 product, imagine if you launched a high priced product and they decide to close your account because of the sudden increase in funds. True, after a few weeks you will probably get your account opened again if you can prove that you are legit, but in the meantime your launch is screwed because your payment processor is no longer accepting payments from you.
      same thing happened to me..
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  • Profile picture of the author Desmond Ong
    If you live in the US, you can always have all the great merchant accounts. You don't need PayPal. Otherwise use 2CheckOut.

    PayPal always suspect you if there's a sudden big inflow of money. And when they limit your account for inspection, that's a big problem.
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    • Profile picture of the author Alan Petersen
      Merchant accounts/Banks also have very quick trigger fingers when it comes to freezing accounts if half a red flag is even partially raised. You just hear more about PayPal because most of us use PayPal. There is a recent big launch that crashed and burned because of problems with their payment processor and it wasn't PayPal.

      In one of Dan Kennedy's books he writes about having his merchants accounts frozen when their is a sudden increase in money coming in and that was in the old direct mail days before PayPal even existed.

      Financial services companies don't understand IM. In the last 5-10 years they have even more laws (anti-terrorism, money laundering, etc.) putting the squeeze on them and these companies are mostly all public. They'll freeze your account in a heart beat if their software red flags something. They could care less about us. Even if it's hundreds of thousands of dollars or even a million dollars. That's peanuts for a multi-billion dollar company who is trying to protect their shareholders.

      As to why the big guns won't use PayPal as it's already been explained merchant account fees are a lot less vs. PayPal (at their level) plus you get more flexibility with one click upsells/downsells, etc.
      Originally Posted by Desmond Ong View Post

      If you live in the US, you can always have all the great merchant accounts. You don't need PayPal. Otherwise use 2CheckOut.

      PayPal always suspect you if there's a sudden big inflow of money. And when they limit your account for inspection, that's a big problem.
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      • Profile picture of the author Andy Immotna
        Originally Posted by Alan Petersen View Post

        Merchant accounts/Banks also have very quick trigger fingers when it comes to freezing accounts if half a red flag is even partially raised. You just hear more about PayPal because most of us use PayPal. There is a recent big launch that crashed and burned because of problems with their payment processor and it wasn't PayPal.

        In one of Dan Kennedy's books he writes about having his merchants accounts frozen when their is a sudden increase in money coming in and that was in the old direct mail days before PayPal even existed.

        Financial services companies don't understand IM. In the last 5-10 years they have even more laws (anti-terrorism, money laundering, etc.) putting the squeeze on them and these companies are mostly all public. They'll freeze your account in a heart beat if their software red flags something. They could care less about us. Even if it's hundreds of thousands of dollars or even a million dollars. That's peanuts for a multi-billion dollar company who is trying to protect their shareholders.

        As to why the big guns won't use PayPal as it's already been explained merchant account fees are a lot less vs. PayPal (at their level) plus you get more flexibility with one click upsells/downsells, etc.
        Yeah, I think that's what happened with Delta Squadron?

        Anyways, I think the main advantage of merchant account indeed is the ability to have your customers go through a funnel..
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  • Profile picture of the author Tim Franklin
    Some interesting thoughts, personally I have been using paypal since 1999, never a problem, (knock on wood)

    However, before I go on a campaign, or launch as its it referred to, I just pick up the phone and have a conversation with a paypal representative, I have them notate my account, that I am starting an advertising campaign and expect to see some good sales figures, and that they can contact me at a phone number should there be any questions,

    Never ever had a problem with that, most of the time, if something does happen it is because someone forgot to pick up the phone, believe me it is not paypals fault if you dont choose to communicate.

    It is really just as simple as that, but there are so many people that just do not know how to do just that simple little thing...

    Just saying, dont blame paypal, if you cant pick up the phone...
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    • Profile picture of the author Andy Immotna
      Originally Posted by Tim Franklin View Post

      Some interesting thoughts, personally I have been using paypal since 1999, never a problem, (knock on wood)

      However, before I go on a campaign, or launch as its it referred to, I just pick up the phone and have a conversation with a paypal representative, I have them notate my account, that I am starting an advertising campaign and expect to see some good sales figures, and that they can contact me at a phone number should there be any questions,

      Never ever had a problem with that, most of the time, if something does happen it is because someone forgot to pick up the phone, believe me it is not paypals fault if you dont choose to communicate.

      It is really just as simple as that, but there are so many people that just do not know how to do just that simple little thing...

      Just saying, dont blame paypal, if you cant pick up the phone...
      Yeah right, I had my 2 accounts shut down previously. But since I always call them before I do my launch, didn't have any problem at all.
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    • Profile picture of the author metaphors
      Originally Posted by Tim Franklin View Post

      Some interesting thoughts, personally I have been using paypal since 1999, never a problem, (knock on wood)

      However, before I go on a campaign, or launch as its it referred to, I just pick up the phone and have a conversation with a paypal representative, I have them notate my account, that I am starting an advertising campaign and expect to see some good sales figures, and that they can contact me at a phone number should there be any questions,

      Never ever had a problem with that, most of the time, if something does happen it is because someone forgot to pick up the phone, believe me it is not paypals fault if you dont choose to communicate.

      It is really just as simple as that, but there are so many people that just do not know how to do just that simple little thing...

      Just saying, dont blame paypal, if you cant pick up the phone...

      This is also what
      Mike Filsaime suggests doing whenever you are going to have a big launch as well just pick up the phone and let them know in advance to avoid these issues.
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      • Profile picture of the author halfpoint
        At what point should you contact them?

        Only if you have a big launch in the works that is going to see lots of money come through in a short period of time?

        What about if you've never used them before and you were going to sell 7 or 8 different products through them and had no ideas or expectations of how often or how much income would be coming through?
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        • Profile picture of the author Andy Immotna
          Originally Posted by Pat Jackson View Post

          At what point should you contact them?

          Only if you have a big launch in the works that is going to see lots of money come through in a short period of time?

          What about if you've never used them before and you were going to sell 7 or 8 different products through them and had no ideas or expectations of how often or how much income would be coming through?
          I give them a phone call when I am expecting a surge of payment receivables. It's this case that they're going to flag the account i believe.

          Had sometimes been inactive and used them again for some time with around 30+ sales and had no problem even of not notifying them in advance..
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  • Profile picture of the author internetwarrior97
    I think even for low dollar items Paypal just takes too much. There are other great payment processors out there that're more reasonable.
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