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eBay forces Aussies to use Paypal

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eBay is forcing all its Australian users to use its Paypal service from the middle of this year sparking outrage over the percentrage of their sales that will now flow back to the auctions giant.

The auction giant's customers will have only two methods of payment available for transactions over the site from June 17: paying in person when picking up the product, or Paypal, a system owned by eBay itself.

All other payments, such as bank deposits, will be banned, apparently in the name of safety.

eBay trust and safety director Alastair MacGibbon said disputes between buyers and sellers are four times more frequent when users pay via deposit rather than using Paypal. "When you crunch the numbers and you look at the disputes that have occurred on the site you get to see some really powerful differences between how people pay and what happens," he told the Sydney Morning Herald.

The announcement met with ire from users, who complained about the lack of options, and the fact that sellers will have to pay even more to eBay - Paypal charges a fee of between 1.1 and 2.4 per cent on top of the auction price.

The eBay Australia forum, hosted by the auction site itself, already has more than 600 negative comments about the move, which include claims that the changes are illegal and calls for users to abandon eBay altogether.

Users outside Australia are concerned eBay may be planning to implement the policy in other countries as well. eBay UK has not commented on this issue.

From 21 May, all sellers on eBay Australia will have to offer PayPal as a payment option. From 17 June the other options will be banned. From that day on, eBay will also expand its PayPal Buyer Protection programme, for users who fail to receive their goods, from AUD3,000 to AUD20,000. ®

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