Person to person payment servicesWhat are person to person payment services?
Person to person payment services, such as Paypal, allow anyone to send money to someone else via email, the web and sometimes phone. These services make it easier to process cross border payments involving currencies differences and more. Initially these services were established to allow auctioneers a way to accept payments quickly and easily.
How to P2P payment services work?
These services require that both the buyer and seller have accounts created before payment can be sent back and forth and that these accounts be funded. Each service has different funding methods but some of the most popular are wire transfer, credit and debit cards and or checks.
What are the primary benefits of P2P services?
P2P payment accounts are very easy to get, anyone with an email address can setup an account and get paid the same day. P2P accounts can make payment easier to customers who are unable to get approved for a credit card.
What are the drawbacks of using P2P services?
P2P services are so easy to get that they give a business very little credibility on the web. While P2P services are acceptable for auction buyers they are generally not acceptable to consumers at websites. In addition since these services require registration by your shopper you could very well lose customers who decide that they dont want to give out their private information to yet another company. These services have at times also been known to freeze accounts based on complaints from customers that are not yet proven true. A frozen account could halt all transactions until resolved possibly losing the merchant many sales.
Is this right for my business?
As an alternative or second payment option Paypal and other P2P accounts can be excellent additions to any ecommerce store but we do not recommend them for any business as a single payment option. If your business is unable to get approved for a regular merchant account try a 3rd party merchant account before resorting to a P2P payment service.
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