Credit Card Order Turns into PayPal Transaction

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January 17, 2010

Credit Card Order Turns into PayPal Transaction

By: Ina Steiner

Sun Jan 17 2010 16:54:46

To the Editor:
I went on the Internet this morning to get a printed T-shirt, and I fill out the form with a credit card (instead of PayPal), and I click submit, and a screen appears telling me that they have checked and I have money in my PayPal account, and will I pay that way instead, and they want to log me onto PayPal!

Of course I want to say no way, and it is hard to even figure out how NOT to go to PayPal. I scour the page and find a tab that says "Continue without logging in", and that takes me to a confirmation page for my order with my credit card info!

So not only are third party sites able to access my PayPal account, but they can try to force me to pay that way, even though I already said I didn't want to, and gave my card info! How long has this been going on, and is there a way to stop it other than closing my PayPal account?

The only possibility is that PayPal is sharing that info, and that is HUGE in my opinion! Think of the customers who will be mad as hell when they try to order, and they will be just as mad at the seller as they are at PayPal!

I want to opt out of this as a buyer AND as a seller. When did this madness start, and how can it be stopped?

Now of course, this may be "old news" to you, but if this is something the clowns at eBay/PayPal just instituted, I hope you will get to the bottom of it and report on it!
Thanks.
Bruce

Comments (22) | Leave Comment | Permalink

Readers Comments

Credit Card Order Turns into PayPal Transaction

by: Mark Wilson

Sun Jan 17 19:14:19 2010

There are so many elements to this story that don't pass the sniff test.

Credit Card Order Turns into PayPal Transaction

by: Fruity

Sun Jan 17 19:29:10 2010

The person is seeing that its the pay with credit card paypal program. What that means is that sellers can offer Visa/MC/DIsc/Amex acceptance through Paypal as the "processor" in this case. And what happens is, if you go in trying to enter in CC information and just pay as normal, if PP has a record of it it forces you to run in through the regular Paypal account. That's been in effect for quite some time, but as shoppers use alternative payments and sites then it becomes more obvious. It does appear that they are not integrating it even more to induce you to use your paypal balance.

The OP is an end user of the system, its more than reasonable for them to see this as accessing the paypal account. Its more of an integration. But when you integrate its meant to give the appearance its controlled by the website owner. The site doesn't have access to your account OP, but it is becoming more difficult to be free of paypal

Just because someone has the wrong terminology doesn't mean they're making it up

Credit Card Order Turns into PayPal Transaction

by: whatever.

Sun Jan 17 20:19:54 2010

I THINK I understand fruity's explanation: the site is using Paypal as the credit card processor; when the customer inputs their card information Paypal checks to see if that card # is on THEIR records as linked to a Paypal account, and then if it is, they prompt the customer with the customer's Paypal account status.

From the standpoint of Paypal it's analogous to letting a website (say newegg.com) keep your credit card info because you assume you'll be placing orders from them in the future.

But the problem is that the OP (or any of us who have Paypal accounts) hadn't yet logged into Paypal before Paypal provided them with some of their own paypal account information.

Of course Paypal has an incentive to change a credit card transaction to a ''move the money around'' transaction where the user's account balance is utilized instead. The problem is: the OP and presumably any of us didn't intend to use our Paypal accounts to pay for the transaction. If we wanted to do that we would have presumably clicked on the merchant's Paypal button instead of the credit card button.

Paypal is in effect attempting to change the merchant's own payment options in their favor. The merchant may not be aware of this or may not care. The customer, in this case the OP, may very well care.

In this case the OP didn't realize that using a credit card meant they were already interacting with Paypal so it seemed as though Paypal financial information was being shared and compromised.

Do I have that right?

Credit Card Order Turns into PayPal Transaction

by: Enough

Sun Jan 17 21:58:22 2010

It's not clear where the purchase was made. I'm assuming it's off ebay. The above comments give us plausible reasons for this happening. It could well be an agreement between Paypal and the website. Ebay and Paypal have been very aggressively expanding the grip of Paypal on ecommerce and this a way to do it -- manipulate the payment process so that the buyer is defaulted to Paypal and has to make a choice and several clicks to go with their own Visa/MC. Sometimes its just easier to click on Paypal and that's what they're banking on.

After the huge success of Paypal, JD has decided to focus on expanding Paypal as he had worked on 'improving' Ebay's core. Expect more twists and turns here.

I recently made a decision to give Paypal as little business as I possibly can and I leave a only small operating balance in my account. I have had a Paypal credit card for a couple of years. You get bonus points for charging items and I finally earned enough points to get bonus. Well, of course, there ARE strings attached. Has to be in only one purchase, has to be done by a certain date, etc., etc. More rules. Note to self: Cut up Paypal Visa card.

Credit Card Order Turns into PayPal Transaction

by: Bruce Hershenson

Sun Jan 17 22:28:01 2010

I am the person who originally contacted Ina. Here is the background to this:

I saw the American Idol guy who did "Pants on the Floor". I went on the net and searched for a shirt with that, and I found a link to a site, TopLine Shirt Company at http://tlnclothing.flyingcart.com/index.php?p=home

I was paying on their site with a Visa card, and all they had to do was process it. But they were steering me to take the money straight out of my PayPal account, and the screen said, "Do you want to take this money out of your PayPal account instead of charging your card" (or words to that effect).

Now I know they only get a fraction of a per cent from a credit card sale, and 2% or more from a PayPal transaction, so doing this stands to make them BIG money over millions of transactions, but it is pretty darn scummy of them, because it cheats the credit card people out of their share, AND it surely angers customers, who may mistakenly blame the seller, and not PayPal.

In this day of "identity theft", surely no one wants PayPal sharing your information in any way with anyone you did not specifically want to have it!

Any of you who want to verify what I say should simply go on that site and start to order a shirt with a credit card, so you can verify what I say (you can always abandon the transaction).

How about someone asking PayPal for a comment on this, either denying they do this, or verifying they do?

Bruce

Credit Card Order Turns into PayPal Transaction

by: Robert Cerveny, Jr.

Sun Jan 17 23:05:56 2010

I would think what Paypal is doing is illegal. You provided a method of payment but paypal wants you to use their payment method. If you havent heard, Paypal is putting temporary holds on seller accounts for no reason. They hold it up to 21 days. They get the interest on the funds while waiting. That is one of the reasons by my guess they want you to use your funds buying a product. The site gave you the option on how to pay and you choose the method you wanted. I would tell Paypal to lay off. It is not up to them to circumvent the seller and/or the buyers method of payment.

Credit Card Order Turns into PayPal Transaction

by: Judy

Sun Jan 17 23:07:40 2010

I had EXACTLY the same problem trying to pay for my son's school application. My Visa card was the same as my Pay Pal so I had to use a different email address or a different credit card number- That is ridiculous! I don't have another credit card and that was my email address... it was very frustrating!

Credit Card Order Turns into PayPal Transaction

by: fruity

Sun Jan 17 23:52:21 2010

Hi all, I went to the website and I know what's going on. Let me explain OK? There's no info being card info being exchanged or anything under the covers there so you're safe. What you're seeing is that this merchant is using a particular paypal product for payment. This is closer to being a traditional merchant account. For sellers with their own webs, some regular merchant accoutns are still costly, so paypal has an account you can get to look more like a retailer but its with Paypal processing the payment. When you were on that site and when to checkout, and entered in your credit card info. You didn't realize you were now moved to a paypal URL. You were actually entering in your credit card info on paypal site and that message you got is from paypal being able to see your account, not the merchant. In this case paypal was acting as that websites "credit card processor"

I know its really confusing but there isn't any cc info that is being exchanged between the two parties. Its the website design & paypals logos (or lack of) to inform you that this merchant processes credits cards with Paypal. Its easy to see it the way you did Bruce! So don't feel bad at all.

One thing I think is interesting, maybe Ina & David will write on this, is why is the logo not showing the typical logo that displays Paypal and then the visa/mc/amx logos along side it? Is that the credit card setup (flyingcart) who did it that way or has paypal changed their logo. I can't even begin to tell you what kind of implications there are if service providers setting up merchant carts are dumping traditional merchant accounts and just opted to run it all through paypal as the defacto credit card processor.

Credit Card Order Turns into PayPal Transaction

by: Fruity

Sun Jan 17 23:55:19 2010

and because paypal knew your credit card number that is why they gave you that sweet talking message of hey why dont you use this instead. That's because they dont want you to run it as a credit card, they really want you to do a bank transfer because it costs them like a quarter to process it.

Credit Card Order Turns into PayPal Transaction

by: fruity

Mon Jan 18 00:02:25 2010

oh and what Robert says is really valid. What it is saying is that PAYPAL is storing or tapping into credit card information you have placed on your pp account to where they can MATCH IT UP and recognize you are a paypal user. Thats disturbing in that they are are doing some kind of lookup across servers without the account holder actually signed in. Know what I mean? You can snitch them out to the FTC for security and credit card concerns. Your complaint should be something like how can paypal be able to query a persons credit card information and match it to a paypal account when you haven't logged into their service and that you are concerned at how they are passing the information to another between their different products.
The other thing you can mention is, just to make em miserable is ask whether that is PCI DSS complaint by the data lookup

Credit Card Order Turns into PayPal Transaction

by: what fruity said

Mon Jan 18 02:40:39 2010

Yep, do what fruity said:
"The other thing you can mention is, just to make em miserable is ask whether that is PCI DSS complaint by the data lookup"

They'll totally FREAK! They hate it when you use terminology they think we don't understand! I love to freak PP out that way!

Credit Card Order Turns into PayPal Transaction

by: Donscycleware.com

Mon Jan 18 03:10:25 2010

The merchant in question is using PayPal to process payments. PayPal will process both PayPal and credit card payments. Unfortunately for everyone but PayPal the process for using your credit card is well hidden within the checkout site. I originally used PayPal for my site: HTTP://DonsCycleWare.com until I received too many complaints from customers who attempted to pay via credit card and were given the false impression that they had to use PayPal. Therefore I opened a merchant account through my bank to process credit card payments.

It is a minor pain because I am now having money deposited through two different sources. I also have to pay an additional monthly fee. But if that is what it takes to keep my customers happy I'm glad to do it.

Credit Card Order Turns into PayPal Transaction

by: eBuyer Feedback

Mon Jan 18 06:18:42 2010

So basically what we have here is a way to see someone's PayPal balance? Fruity, when you were testing this out did you need to correctly enter your name and address for it to display this info? Did you also have to enter the security code and expiration date properly? If not then that is a huge security hole (still a hole either way but much worse).

PayPal got into a lot of trouble a few years ago with their German site letting people reset their passwords when all they knew was their phone number which is legally required to be displayed in the seller's listing (or something like that).

Credit Card Order Turns into PayPal Transaction

by: Quick answer

Mon Jan 18 06:57:23 2010

DO NOT purchase anything if paypal is even remotely mentioned. Why are you buying there anyways? better off to use Bonanzle, iOffer and other sites where you have lots of choices how to pay. Common knowledge now that paypal is corrupt as ebay.

Credit Card Order Turns into PayPal Transaction

by: m

Mon Jan 18 14:30:56 2010

"Quick answer", iOffer is non-paying buyer and fake product heaven. Seems that the only thing that keeps the site afloat are all the sales from fake Gucci bags, etc.

And Bonanzle's traffic is horrible..
I sold on both sites for quite some time, and have to say that they are not worth the effort.

Credit Card Order Turns into PayPal Transaction

by: fruity

Mon Jan 18 14:51:39 2010

eBuyer: It's not a way to see a persons paypal balance. Its for that person to see THEIR account. The retailer/website owner doesn't see it. You have to understand, that the only time the buyer is entering in information they are now on the paypal url. What happens is that its paypal that chooses to notify the buyer, who also has a paypal account, that hey why dont you forego just running it as a straight credit card and use us instead. That's really the heart of it.

Hey, I'm more than happy to serve this company some dog food, but this is truly a situation where the design of the interface is confusing and that paypal likes it that way so they can influence you to use a different paypal system to run your payment through.

The OP is not doing anything wrong by seeing this as a concern. It truly makes you wig out when you experience it and if you dont understand how the systems integrate just gets crazy crazy!

In particular, Paypal benefits from this because while some of us say I dont want to use paypal whatsoever, the way its designed sure can spook a potential website buyer into thinking oh maybe I will just ONLY use paypal and NOT use the ones with the straight Visa/MC logos. See where I'm going with this?

Anyways, the best thing you can do is tell your sellers that you dont want to buy if any of your order is being run through a paypal product. Personally for me, I'm not interested in ebay, inc knowing my shopping habits when i'm outside of their prison yard

Credit Card Order Turns into PayPal Transaction

by: Lisa

Mon Jan 18 15:43:14 2010

PayPal offers merchant services for sellers with retail sites or services that can also be incorporated into some shopping carts. But "The only possibility is that PayPal is sharing that info, and that is HUGE in my opinion!" is ignorant and incorrect. That is hardly the only possibility. More likely, the merchant uses PayPal for credit card processing through a payment gateway and PayPal would automatically require you to log-in and would use your balance. If the merchant accepts credit cards through other services, PayPal would then become one of a few options. Some merchants like to offer PayPal because so many people online are familiar with it and it saves them having to remember their credit card information or put their CC info out where they don't want it. PayPal does not share any vendor's information with others - that's in their agreement. But if you have a PayPal account and you failed to opt out of their information sharing notice, then you agreed to allow your information to be made available to PP's partners and associates. Ask the merchant about it but there is nothing wrong, illegal or untoward in what happened. My Payment Gateway, CCCP2 allows me to accept credit cards through Authorize.net or PayPal or Google or pretty much any service that is available. :)

Credit Card Order Turns into PayPal Transaction

by: permacrisis

Mon Jan 18 19:15:06 2010

The only industry watchdogs who are going to take action on this are the credit card companies themselves. Report it to THEM.

I know it's sad to have to resort to that, but 'The Enemy Of My Enemy Is My Friend' definitely holds true in this case. The CC's have the deep pockets to bring suit. And there are enough different companies that together, they can FORCE a level playing field on the Internet.

But first they have to know about it.

Credit Card Order Turns into PayPal Transaction

by: whatever.

Tue Jan 19 00:49:33 2010

Lisa, apparently the last bit of your post was cut off:

Sincerely,

Lisa
Paypal Customer Service

It was pleasure to assist today.
I apologize for any inconvenience.

Credit Card Order Turns into PayPal Transaction

by: whatever.

Tue Jan 19 00:59:42 2010

Lisa,

Now to address your post.

If a person is misunderstanding something and you have the information to clear things up, telling them they're ignorant isn't exactly the best way to do it.

But, the real meat of your comment in my opinion is:

''More likely, the merchant uses PayPal for credit card processing through a payment gateway and PayPal would automatically require you to log-in and would use your balance. ''

Really? The OP didn't state that they were required to log into Paypal. AND you're saying that Paypal is going to ''use your balance'' even when they are only acting as the merchant's credit card processor?

Either you are yourself ignorant or you're giving us a peek into the next Paypal implementation to come.

Oh, and the reason I think you are a Paypal shill? Who outside of Paypal would type this?

''Some merchants like to offer PayPal because so many people online are familiar with it and it saves them having to remember their credit card information or put their CC info out where they don't want it.''

But thanks for reminding me of a probable failure on my part: I'm off to opt-out of Paypal's information sharing right now.

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