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A better alternative to Paypal

No accidental fee charges

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#1 Bchamp22795

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Posted 23 July 2014 - 11:26 AM

Before I start, I want to say I have no affiliation with Venmo and there are no personal gains from me posting this.

So for a long time, Nerfers have used Paypal for electronic payments to move goods back and forth, myself included. The problem with paypal (in my experience) is that people who have never used it before often make mistakes and send payments that have fees attached for the seller. This can be a hassle in many cases, as it takes longer to complete a transaction. Furthermore, it can take awhile to set up and "verify" yourself on Paypal. I had to send in scanned copies of my drivers license and birth certificate or something in order to verify my identity. I'm not sure if they still do this, but I remember it being a pain in the rear.

Recently, I discovered a site called Venmo that my friends had been using. It is a bit easier than paypal and has NO FEES (when using a debit card or bank transfer, credit cards are 3%). There is no room for error in sending money and accidentally having fees attached. Transactions are just as fast or faster than Paypal, and it has a "social media" type aspect to it as well where you "add friends". The purpose of the website/app is if a group of friends order a pizza, one person pays with a debit card, then the others can easily pay him/her back completely electronically. No rounding up when splitting seven ways, no dealing with coins, etc. I think this would be a super easy and safe way to do sales transactions in the nerfing community online and at wars. No need to bring a bunch of cash with you, have change for a $20, etc... just bring your smartphone (you can do with with paypal, too, but again... there may be fee charges if you aren't careful)

I'm kind of on my way out when it comes to Nerfing (for now), so I won't see much benefit from this myself, but I hope others will! Please feel free to comment on what you think. I'm sorry if this is considered a "plug", but I honestly think it's something that we should start doing as a community.

TL;DR - Paypal can be difficult to sign up for and have accidental fee charges if you click the wrong button. Venmo is easier and doesn't have the fee charges. Otherwise, both are basically the same functionality wise.
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#2 Daniel Beaver

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Posted 23 July 2014 - 01:25 PM

I do wonder how they plan to make their business model work. The old adage "If you're not paying for the product, you are the product." comes to mind. As scummy as Paypal can be, at least I know where they stand.

Edited by Daniel Beaver, 23 July 2014 - 01:26 PM.

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#3 Ryan201821

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Posted 23 July 2014 - 03:15 PM

This seems like it might be worth trying. The only problem with this is no one knows or trusts this particular site, so as a seller it might be difficult to get someone to use this.

I don't mind paying the 3% on PayPal because I can actually trust PayPal still has my money at the end of the day. Obviously I would like to keep my 3%, but other merchant services and card processing sites usually charge right around the same amount.

Also I'm not sure vemno has an option for this but my PayPal debit card is really nice to use for buying materials from McMaster, Home Depot, etc...so I should just check this out instead of asking more questions.
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#4 Bchamp22795

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Posted 23 July 2014 - 05:36 PM

A small con I just found is that venmo does not do international payments.

Venmo currently makes money by getting companies to accept venmo payments (similar to paypal, google wallet, etc in select places) and charging the company like credit card companies would charge a company. Not like paypal that charges all merchants, but rather only charging a company that approaches them or that they approach to contract the service (so our sales shouldn't be a problem)

The main idea behind venmo is that it is for friends to exchange money, not for merchant transactions. So the default is fee-less, rather than paypal which is the exact opposite.

Venmo doesn't have any debit card features. I happen to pay my rent to my apartment complex using venmo, but that is because my apartment complex has an email address and I send it to them, just as one would paypal.

Edit: Just found this link saying that venmo is backed by the FDIC and Wells Fargo. The only complaint I've heard about venmo is that they can freeze your funds if you are linked to fraudulent activity (e.g. accept stolen money), but that is the exact same thing paypal and every bank in america does.

Edit2: Also found this link which mentions how venmo has made a lot of its money through being acquired by a larger company, Braintree.

Edit3: Found out Braintree was acquired by Paypal in December. So it looks like Venmo was acquired by Paypal (which is owned by Ebay).

Edited by Bchamp22795, 23 July 2014 - 08:03 PM.

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#5 Zorns Lemma

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Posted 23 July 2014 - 09:50 PM

The problem with Venmo is that, as far as I know, both parties need an account in order to transfer funds, especially at the lower rate.

I have been using it on and off and now I prefer https://ribbon.co/ (not sure if just anyone can sign up, I got early access). Ribbon lets you pay people even if you don't have an account at standard rate for credit cards and free with debit or bank. You can also pay someone else with Ribbon and the other person doesn't need an account to accept money.
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#6 Bchamp22795

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Posted 23 July 2014 - 10:59 PM

The problem with Venmo is that, as far as I know, both parties need an account in order to transfer funds, especially at the lower rate.

I have been using it on and off and now I prefer https://ribbon.co/ (not sure if just anyone can sign up, I got early access). Ribbon lets you pay people even if you don't have an account at standard rate for credit cards and free with debit or bank. You can also pay someone else with Ribbon and the other person doesn't need an account to accept money.


That looks great as well! After reading the FAQ, it says there are limited account spaces and there is a waiting list to get accounts.
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#7 DX-Robert

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Posted 26 July 2014 - 09:16 AM

The problem with paypal (in my experience) is that people who have never used it before often make mistakes and send payments that have fees attached for the seller. This can be a hassle in many cases, as it takes longer to complete a transaction.


This is NOT a mistake. If you send a transaction as a gift "for friends and family", that transaction is irreversible. If something goes wrong with the transaction, the buyer is now out their money, you can't file a case for that. You can't demand that people send as a gift unless they really trust you. If 2.9%+$0.30 is that big of a deal, just build it into the item price or draw it from extra funds in your self-insurance fund (because you are self-insuring, not relying on carriers' near-worthless shipping insurance, right?). Paypal's fees are slightly annoying, but there are things it doesn't charge for that others do and lacks some limits that others impose, like minimum transfer/withdrawals.

Paypal's cashback debit card should not be overlooked. You can use it to ATM your money out of Paypal as cash, which you can then spend or deposit into your bank account. If you can find a free/in-network ATM, this is the fastest and best way to make your Paypal balance usable (don't have to wait 3-5 days to ACH it to your bank).

I had to send in scanned copies of my drivers license and birth certificate or something in order to verify my identity. I'm not sure if they still do this, but I remember it being a pain in the rear.


It was never like this. If you live in the US, there is automatic/instant eVerify. Nobody needs to send documents, if you have a phone and a bank account, you can get a Paypal account in seconds.

A small con I just found is that venmo does not do international payments.


Small? That's a major con. More than half of my transactions are international. US buyers have falling disposable income, while many international buyers don't know what to do with all of theirs. There's a small export boom going on now that companies across the country are slowly realizing this. We're going to crash really hard if the current business model continues much longer. Firms are trying to squeeze too much profit out of what they can in the short run and are screwing everyone's long run prospects. Increasing salaries and wages are not matching increasing profits. Something like 70% of our economy relies on consumption, but consumers aren't getting enough disposable income. No income, no consumption, no economy. That's not politics or even economics, that's common sense. We can expand manufacturing, have the government spend more, pay people more, or export. I don't see the first three options happening, so it's not surprising that more and more people are exporting. It's a symptom of a serious problem looming in the future.

You need access to those international markets unless you're in an industry that services the wealthy or provides something that people always need and will prioritize paying for. Obviously, this is beyond the scope of a payment processor for Nerf blaster sales, but it's relevant in that businesses and individuals alike, are all looking for the best processors with the lowest fees. Everyone collectively decides why something like Paypal rises or falls, so you have to look at the big picture or you'll just be swinging away at a whole forest with one axe and wondering why it doesn't fall. They care more about businesses anyway, try calling Paypal customer service and find out how much you matter as an individual.


If you really want no fees, use Payeer, which has free Payeer-to-Payeer transactions and can't freeze your funds. Nobody other than Russians and eastern Europeans really use Payeer, though.

There are the cryptocurrencies, which require a greater degree of trust to use since all of their payments are irreversible. Bitcoin sounds like a good idea until you try to convert it to USD (try to Coinbase BTC to USD and deposit it to a linked bank account, you will get warning letters from pretty much every major US bank, they hate it). Then, there is Ripple. You can send anything of value as payment on the Ripple network for a TX fee around $0.0001, but getting an address and a gateway account up and running is even more of a hassle than Paypal. The problem there is that trust governs value, so you can have the same asset, but at different values because one gateway is more trustworthy than another, so its USD is worth more than another's.

That's something important to bring up, once in digital form, USD are not all worth the same value. The most trusted sources with the widest acceptance have the strongest values. Because USD.Paypal can be used online, in credit card terminals, and ATMed as cash, it has one of the highest acceptance rates and among the highest demand. If you ever need to use a money exchanger, you will quickly find that they categorically shun US service, so USD.Paypal might be the only thing you can use in trade.

TL/DR: Unless something drastic happens, Paypal is not getting replaced. We're the informed users, too, the less informed ones definitely aren't moving. Most of the users on this site won't be able to move to a different processor even when informed, due to trust issues or parental control of/influence on, their finances.
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#8 Daniel Beaver

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Posted 26 July 2014 - 09:26 AM

There are the cryptocurrencies, which require a greater degree of trust to use since all of their payments are irreversible. Bitcoin sounds like a good idea until you try to convert it to USD (try to Coinbase BTC to USD and deposit it to a linked bank account, you will get warning letters from pretty much every major US bank, they hate it).

My credit union doesn't send me angry letters when I transfer between my Coinbase account and my checking account. People need to stop using banks and start using credit unions.

I do think cryptocurrencies would work pretty okay for cases like nerf, where transactions are small on the flow of money tends to stay within the hobby. I've never had much faith in the reliability of chargebacks, so I don't find the finality of bitcoin to be a drawback. I've been using bitcoin for exchanges with some of my other hobbies, and I'm perfectly willing to do that for nerf. Another nice thing about bitcoin is that you don't need a bank account to start in the first place - if you're willing to build and sell a few blasters, you can build up a reserve to work with.

Edited by Daniel Beaver, 26 July 2014 - 09:27 AM.

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#9 DX-Robert

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Posted 26 July 2014 - 09:53 AM

Credit Unions work *if* you live near their few branches. The best one in my county is a 40 minute drive without traffic. The only credit union with a branch within 20 minutes has worse terms than my community bank. I haven't tried to use Coinbase with my community bank, yet.

Personally, I'd only take BTC through Ripple, for its 2-5 second clears, ability to trade in/out of BTC in the same amount of time, and substantially lower TX fee. I'm not sure if the Bitcoin Bridge is still functional, but there used to be one where you could send BTC directly to a Ripple address.
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United Nerf Ops - The premier northeast US nerf club serving the tristate area (NY, NJ, CT)
NYC Nerf Ops - Nerf in New York City itself
NJ Nerf Ops - Nerf in New Jersey
CT Nerf Ops - Nerf in Connecticut

UNO also has a Discord server, DM me on Discord to join (@vincentdrake)

 

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My other groups:
Nerf Thrifters - A group for posting thrifts and other second-hand finds



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