ebay – Stay N Alive

Like ’em or Hate ’em, Paypal May be the Best Checking Account Alternative for Business Banking

Most of you know my relationship with Paypal. They sent my wife away in tears on a recent Ebay transaction, and their customer service can be horrible at times (I’m now out $230 of my own money because of it, and because supposedly they can’t trust me). At the same time I’m on their Developer Council and I love ’em to death, because as a developer I feel I have a voice with them. Regardless, when compared to my bank, I see Paypal in an entirely different light than the situation with my wife. Without a doubt, Paypal is one of the most innovative banking solutions out there right now, and that’s hard to ignore. I wonder, could Paypal be a decent replacement to my business checking account at my bank? I’m starting to think it could very well be.


Let’s start with their biggest strength. Paypal is by far one of the most innovative banking platforms on the planet right now. They are entirely set up to work virtually. They were one of the first to set up online money transfers. With just an email address I can send money to someone. I can set up, and take credit card transactions, entirely online. I can scan checks with my cell phone and they go into my Paypal account. They’re attached to Money Market funds that produce interest on my checking account. I was even able to order a debit card online, and now I can withdraw actual cash from my Paypal account.

Let’s add to all the additional payment services I can use and set up, all online. I can add, just by copying simple HTML, a payment widget to my website if I want to take payments. I can set up shopping carts with ease. I can integrate to payments, deposits, and more, all through a developer API. My banks can’t do that.

With my bank, especially my business account, my options are limited. I don’t yet have online check deposit capabilities on my business account.  I don’t have an API to access payments. Heck, for many business checking accounts you don’t even make interest on your accounts! Granted, my personal account situation is much better – I use USAA, whose services are second to none, but let’s stick to business for purposes of this post.

Customer Service

As I mentioned, Paypal customer support sent my wife away crying because we just happened to throw away our shipping receipt for an Ebay transaction that went bad 2 months after the fact. However, if I contrast that with my business banking account, that’s not so bad. With them there is no leverage – if you make a late payment, you get a fee, no leeway. I have to travel somewhere to get any sort of personal service, and calling them takes long waits on the phone. My bank is constantly trying to find new ways to charge me more money. At my bank I have very little protection if someone makes a fraudulent purchase from my bank account. I just don’t see that as much from Paypal. Compared to my business banking, Paypal looks pretty good!

Maybe my experience is different than yours. For my banking solution I have to have a multi-state banking solution that has offices in Delaware, considering my business is a Delaware LLC and my business is almost entirely virtual. So I guess my options are limited. However, Paypal is starting to seem like an awfully good solution to me right now to replace my business checking account. True, they’re not FDIC insured, but is the FDIC even viable any more? I’m starting to think my money may actually be better protected with a solution like Paypal, vs. the FDIC.

What do you think? Are there any better solutions for business banking out there? Should I consider moving my business accounting entirely to Paypal? I’m starting to think that may be a good option.

Paypal Innovate 2010 – Expect Mobile, Personal

If there’s one thing Paypal does well it’s put on a great Conference.  This year at their annual Paypal Innovate Developers Conference, Paypal is ramping up for some big announcements, great training, and amazing guests.  Greeted at the Conference is a multitude of Paypal employees inviting guests to the next generation of payments platform.  The one thing that seems evident at this conference – we’re going to see a lot of “personal” and “mobile” in the era of personalized, simplified payments.

The first thing attendees got as they attended the conference is a new serviced offered by Bling Nation, allowing guests to pay wirelessly at participating vendors with a pre-populated $20 given to each attendee in their Paypal account.  The service offers attendees a sticker they can attach to their phones that seems to send an RFID signal to the payment processors participating in the service.

Also launched last night was a new version of Paypal’s iPhone app, offering push notifications and other ways to pay on a cell phone.  Paypal has really been pushing to improve their mobile payments solutions.

Whatever they announce, there’s no doubt that the future is here.  Paypal will no doubt be entering further and further towards removing the cash from your wallet and into an era of mobile, and personalized payments with your Paypal account.

Ebay Suggests Identity API – Can They Do it Alone?

Paypal X Innovate 2009Ebay’s CTO, Mark Carges, today announced at Paypal X Innovate plans by Ebay, Inc. to begin incorporating the Paypal login process as an identity platform for consumers to eventually open up to developers.  The platform, Carges said, aims to use the existing Paypal login ID which includes address and phone number verification, bank account attachment, and more to identify individuals as real people.  He stated Paypal already goes through great lengths to protect these users’ identity, suggesting this was a natural move towards identity in the cloud.

The move makes sense, but searching Twitter during the Keynote revealed a different story.  Audience members are skeptical, stating things like “scary morning talk by the Paypal CTO. all your ID belonging to us. a closed OpenID?” and “wonder if this is what @timOreilly is afraid of – platforms becoming the OS?”.  In many ways these audience members have a point – is it possible for Paypal to go alone in this identity space when they could either be leading or joining existing identity efforts such as OpenID?  I may be wrong but I do not recall any mention of the word “open” in his proposal.  And when he mentions things like “they are working with Government” it gets a little scary that a single company may control all this along with government.

At the same time, maybe this is the solution.  Will the solution to identity be a closed platform that has devoted ways of verifying identity like Paypal and Ebay can provide?  Does the web need a “more secure” closed platform to finally solve the identity problem?

I’m very interested to see how Paypal progresses on this.  My hope is that they either lead or join existing open standards in this effort, and rather than taking this alone they approach others.  A platform is always a good thing, but a platform is not “open” until it is based on open technologies and the technologies themselves are built by the community.  This is especially applicable in the identity space.

Paypal’s CEO yesterday reiterated that through the years payment itself was controlled by a few big entities.  Paypal’s vision is “Into the hands of many” , intending to pass that control to the developers.  He even compared it to Linux and how the future is in the community and no one company having control.  My hope is that Paypal maintains this standard in the identity arena.  Based on their vision so far it looks hopeful – let’s hope they don’t feel the need to take the Identity platform alone.

When it’s uploaded you can listen to the whole Keynote in my Cinch folder.