Rik Logtenberg on Jul 08, 2009

PayPal has many critics. The problem is, although it acts like one, this online payment processor is not bank and is not subject to the same regulations as a bank. For many people who rely on the company for making and receiving online payments, Paypal has used this freedom from regulation, some claim, to get away with almost criminal customer support. Try a search for “problems with Paypal” and you will find hundreds of websites with thousands of stories about how paypal froze accounts without warning, failed to prevent scams, or failed to do something after a scam was discovered.

In the past, I was a Paypal booster. Their system is easy-to-use, efficient and affordable. But after a client’s recent problems with their account and the terrible customer support, my enthusiasm has dimmed. I won’t go into details here (post a comment if you want to know more), but I think if you’re a Paypal user, it’s really good idea to understand what Paypal is and how they work.

Here’s a great article on how Paypal works.