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PayPal happens to be the most widely used online payment processor in the world. They are considered to be the most reliable money transfer method. Those who hardly knew anything about this, it’s time to know about it and understand the pros and cons of this system.
PayPal is generally used for money transfer using the e-commerce tool from one place to another. An estimate says that there are more than 87 million users all across the world who benefit from the services of PayPal. Despite having all the advantages, PayPal also has a number of demerits, let’s discuss some of them:
Advantages of PayPal
1. Trusted Name
Many people who shop avoid giving their credit card or checking account details to any vendor or online store. Since PayPal’s role is somewhere in between the two, the Web store never gets the bank details of any customer. Hence the customers get trust and confidence of shopping from anywhere using the PayPal account.
2. Ease In Execution
Incorporating the e-commerce system at your website can be an expensive business. Hence small-time vendors and smaller groups prefer to use the services of PayPal, where they don’t have to invest much and get the money transferred safely to their account. The system of PayPal is easy to use and understand wherein it creates everything right from invoicing to the safe fund transfer.
3. Free To Execute
Though the PayPal charges some small amount for this money transfer by the customers under a transaction fee, it permits your small business to use their services for free. The larger groups can avail their option of Website Payments Pro Plan, which gives them the opportunity to receive money straight to these big shot’s website. This saves some money.
Disadvantages of PayPal
1. Locked Accounts
There are lots of security issues and a threat of terrorists using these services, the US government has strict regulations enacted which demands to limit the number of transactions through PayPal. Hence you will find PayPal blocking your account in case if it notices any kind of suspicious situation. The accounts can remain frozen for long till the PayPal investigates it thoroughly and gives a clean chit. This period could last for months thus preventing the business groups to extract money from their accounts.
2. Corporate Access To Your Bank Account
Though PayPal acts as a cushion between people shopping and their bank details, it gives them to have access to the customer’s bank accounts. Due to this, you may find your funds getting deducted even without your authorization or knowledge in case chargeback conditions are met by the consumers.
3. No Outside Arbitration
If there is any dispute between the user and the PayPal over the issues of charges of fraud, the account of the user gets frozen. This goes for other administrative issues owing to the limited resources. PayPal’s service terms give the company the power over all funds in their possession, while the investigation is put forth without giving any documentation to the user.
You will find millions of users across the world and have embarked with as a trusted name in money transfer over the internet. People benefit in many ways using PayPal for their online shopping and auctions over the internet. However, the service is not suitable for all types of business. You may lose your valuable money than reaping the benefits promised to you.