back to article Online trading not anti-competitive for small biz

Small and medium sized (SME) companies do not face major anti-competitive barriers when trying to sell goods or services online, the Office of Fair Trading (OFT) has said. The OFT has published research (pdf) it commissioned into the services that SMEs need to use if they are to trade online. It said that internet technologies …

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  1. Stuart 22

    It is

    As the report admits - small biz is constrained to operate through a tiny selection of monolithic pay merchants.

    There is little incentive to lower commissions for lower turnover. Also dispute resolution is poor. It has to favour the buyer but the merchant has no incentive to be fair to the business when it is victim.

    We need more choice, the entry gates to merchant services precludes small/medium providers.

    1. Nick Kew

      On the contrary

      As a one-man business in 1999, I was able to sign up to accept payments through Worldpay (now owned by RBS). Yes, I had to convince them I was real, but that was actually *less* of an ordeal than opening a bank account with some providers (like Egg, for instance) who go OTT in asking for proof of identity. Not a problem to go it alone either, but it seemed more cost-effective to outsource the service. And if I can do it, then so can anyone half-serious about running a business!

      The Big Barrier (and cost) to accepting payments online is UK law. If $biz fails to deliver and does a runner, the creditcard provider is liable to pay up, so it's no wonder small businesses have to pay a risk premium!

      1. Graham Marsden

        Worldpay...

        ... is all very well provided you're not dealing in "adult" products, in which case, as happened to someone I know, they suddenly found themselves being informed that Worldpay would forthwith no longer provide services to their (entirely legal) business.

        For an SME, having to change payment providers at no notice is a serious problem.

  2. The First Dave
    Boffin

    untitled

    Interesting reference to PayPal and fraud resolution. I know that it is only ever the bad news that makes headlines, but has anyone ever had a _good_ experience with PayPal disputes?

  3. Philip Cohen
    FAIL

    Visa/Mastercard chew on PayPal

    Draft Media Release

    “It is with very great sadness that eBay’s Chief Headless Turkey, John Donahoe (aka “Peter Principle”—among many other derogatory terms), announces the probable demise of eBay’s most ugly daughter, PayPal. PayPal is about to be stricken by particularly virulent strains of Visa+CyberSource and Mastercard Open Platform, aggravated by PayPal’s insurmountable lack of direct financial institutions participation and a great deal of PayPal user/merchant dissatisfaction, particularly with respect to PayPal’s grossly unfair, “all responsibility avoiding” UA, totally primitive risk management processes, and grossly unprofessional, buyer-biased, fraud-facilitating, transactions mediation.

    “PayPal’s health may therefore be expected to deteriorate and, if ultimately not completely incapacitated, will most likely be eventually confined to its mandatory offering on what little there will be by then left of the Donahoe-devastated eBay marketplaces. There is no cure for this condition, and the “eBafia Don” is particularly saddened by the inevitable presumption that it is unlikely that PayPal will be able to continue to underpin eBay’s sagging bottom line in the future.”

    Also, unlike all other payments processors operating in Australia, PayPal has declined to sign up to the payments processors’ “Code of Conduct”. The clear message therefrom is “users beware”!

    The fact is, had the original developers of the “bankcard” concept ever behaved the way PayPal behaves, credit/debit cards would never have gotten off the ground, and we would still be paying for all our purchases with pieces of paper and little metal discs.

    A detailed examination of and prognosis for PayPal (including a further link to the “PayPal Horror Tour”) at

    http://www.auctionbytes.com/forum/phpBB/viewtopic.php?p=6504554

  4. Mips
    Jobs Halo

    Have you tried selling to Goverment?

    Well hell yes! There is a stone wall to get over. Financial notations and framework agreement favour the big players. No. I am wrong, favour is the wrong word. Forget glass ceilings, think in terms of reinforced concrete. Some of this is caused by EC regulations. Anti-competitive? I should say so!

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