eBay restricts users to just paypal and cash

Today eBay Australia have announced plans to aggressively expand PayPal into the Australian market by banning all other methods of payment* used by buyers/sellers for goods bought/sold on eBay. eBay are marketing this as a 'security' position to their loyal sellers, some may say this is a facade, and that this decision is revenue orientated given the auction giant will now collect revenue of between 1.1-2.5% from the sale price (+postage) of all items paid for using PayPal.

• From 21 May eBay sellers must offer PayPal on all listings as well as currently permitted payment methods.
• From 17 June eBay sellers will only be able to offer PayPal on listings and pay on pick up (i.e.paid for when picking up the item).

*Pay on pick up can only be offered in conjunction with PayPal. No other payment methods will be permitted.

Read more courtesy of The Age
Read some reactions at the bottom of this page on The Australian
Read the actual briefing on the eBay website

A contributor to thebankchannel.com shared his opinion on what this change means:

• It means that payment methods such as Internet Banking (hugely popular amongst Australian consumers) are no longer permitted by eBay as acceptable ways of buyers/sellers making/receiving payments
• The banks have become even more of a 'manufacturer' and PayPal continues to use banking infrastructure to process its payments, closing banks out of the loop
• It means that challenger payment systems such as PayMate and other p2p payments platforms are excluded from a key volume of transaction they [may] target
• It allows PayPal to grow it's 'short term cash holdings' and therefore its short-term money market revenue - already under scrutiny in the USA
• It forces sellers to Pay a fee of somewhere between 1.1 and 2.5% to receive payment for items sold on eBay - as opposed to 0%/$0 for bank transfers
• It enables PayPal to rapidly expand its customer base in Australia and therefore forces anyone eBay user to become a PayPal customer
• It could seriously damage eBays listing volumes in Australia (i.e. a seller boycott - as recently seen in the US when eBay changes it fee structure)
• There will be questions around the legality (Trade Practice Act) of this given it may be considered as '1st line' forcing. Remembering that eBay (perhaps this is why they are still allowing face-to-face payments as a technicality to overcome 1st line forcing issue).

What's next for PayPal... Would not be illogical to suggest that with banks seriously undervalued, a banking license could be acquired at a reasonable price in Australia... Anyone for an acquisition? If PayPal do this, they'll directly fall into competition with Australian banks, they could start paying interest on deposits (like they do in the USA), provide a debit card (US/UK already), consumer finance/lending (US already) and of course a credit card (US already)...