eBay Backs Down on PayPal Exclusivity

For those of you that use eBay either to buy or sell items, you would have been aware of plans to set PayPal as very much the sole payment method for  auctions. A significant amount of noise was made here in Australia by both companies and individuals alike about restriction to consumer choice if the move went ahead. When the ACCC began accepting statements from interested parties, organisations such as the Reserve Bank of Australia (RBA) and even the Australia Securities and Investments Commission (ASIC).

What makes the whole thing really smell rotten is  the fact that PayPal is a wholly owned subsidiary of eBay. Furthermore, it looks like a case of “third line forcing” whereby the freedom of choice of a person is affected by restrictions imposed by another.

eBay did relent on its initial requirement of only allowing PayPal for transactions but did retain a requirement to offer PayPal as one payment method for every auction alongside others. The good news is that from July 14th, users will have the option of offering at least one of the following payment methods:

• Paypal,
• Paymate,
• Credit Cards.

I think this is a good outcome for buyers and sellers alike but I am surprised that eBay managed to get as far as it did with its financial transaction strategy before being pulled up by the ACCC. The wheels do turn slowly but at least they turn.