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PayPal Alternatives

PayPal is synonymous with eBay, after all, PayPal is an eBay company. The vast majority of transactions on eBay are paid for through PayPal. It's quick, convenient and easy to use. Many eCommerce websites also use PayPal in one form or another. However, PayPal is not the only option for receiving payment for your goods, both on eBay and on your website. It's true that you have to offer PayPal as a payment method for most items on, but that's not to say that it has to be the only method you can accept. Let's take a look at some other options for your buyers, and maybe you can save some money in fees by looking at some PayPal alternatives.

Note: all of the payment options discussed in this article are currently allowed in eBay UK's Accepted Payments Policy


Nochex are a leading UK based online payment company, specialising in providing smaller online businesses with simple, accessible, easy to use, online payment services. They offer two basic accounts for accepting payments, the Seller Account and the Merchant Account. They also provide a personal account for making payments for goods and services. The Seller Account is the ideal entry level account suitable for smaller businesses and traders. Easily collect payments funded by all major credit and debit cards from your website and/or eBay. There's no monthly fee, and a flat rate for transactions of 2.9%+20p. (PayPal's entry level basic flat rate is 3.4%+20p, with reductions for higher turnover once you get past £1500 per month). Already, that's a possible saving of half a percent per transaction. The Nochex Seller Account can only be used for UK payments, and is fairly easy to integrate into many popular eCommerce shopping carts.

For the larger seller, or if you need to accept international payments, Nochex offer the Nochex Merchant Account. This offers you a total online payment service. Unlike many other payment services, you don't need a separate internet merchant account and a payment gateway (traditionally difficult to obtain for new and small businesses with limited trading history). You can accept payments from all major credit and debit cards with no customer sign up required. You get UK phone and email support with a dedicated account manager and competitively tiered transaction rates. The rates are tiered, depending on your turnover and the type of goods or services you offer. There's no monthly fee, just a one time only set-up fee.


Moneybookers is a good option to consider if you have buyers from the USA, with the ability to accept online payments from over 30 countries. All that's needed to receive money is simply to provide the payer with your email address and they can send you payments via Moneybookers. Anytime someone sends you money using Moneybookers, the funds will be instantly credited to your Moneybookers account balance. The transaction fees for the basic Email Pay Account start at a very attractive 1.9%+19p per payment received, with lower fees for higher turnover.

For easy website integration and a more professional payment solution, there's the Moneybookers Merchant Gateway with fees starting at 2.9%+19p per transaction. This account enables you to accept credit and debit card payments with their secure quick checkout system.

One complaint we hear repeatedly about PayPal is the amount of chargebacks that are received. A chargeback basically means that the either the buyer, or the buyer's bank or credit card company disputes the payment made to you. Often the seller loses out, sometimes it's because the buyer simply didn't remember making the purchase, or sometimes it's outright fraud. One major advantage of Moneybookers is their fraud control policy. Transactions are not reversible, and once you're paid, you stay paid. They also offer an optional business model with full fraud and chargeback protection, which means they absorb chargebacks costs themselves without passing on the charge to the merchant. Another good reason to consider Moneybookers for your website, is that they include you in their online shopping directory at no extra cost.

Cheques and Postal Orders

Considered old fashioned by many, there are still a few advantages to taking cheques and postal orders. Some people still don't have a credit or debit card, or they simply don't like PayPal, and prefer to pay by cheque or postal order. There's one major advantage to these payment methods - no fees. Admittedly, some business bank accounts charge you to pay in cheques, but for personal banking it's usually free to pay in a cheque. The downside of course is waiting for the money to clear, and it's always a good idea to inform customers of the extra wait involved when paying by cheque. Postal orders are a nice way to be paid, it costs you nothing except a trip to the post office, and you can convert them quickly into ready cash if they are not crossed. If a postal order is crossed, it must be paid into a bank. If you're not accepting cheques or postal orders, you may be losing out on some earnings potential.

Bank Transfer

Bank transfer, (also known as direct transfer, wire transfer, cash transfer, BACS or IBAN) is also another excellent option for receiving money. First of all it's usually free (check with your bank first) to receive money up to certain amount through this method, and it's far quicker than waiting for a cheque to clear. Many European customers prefer to pay by bank transfer. All you need to give the buyer is your bank account number and sort code, or for international transactions they will need your BIC or IBAN code (you can normally find them on your bank statement), and they put the money directly into your account. Is it safe to give people your bank details for bank transfer? Yes it is, you're not giving them any more information than you give out when you send someone a cheque. After all, they're paying money into your account, not trying to take it out. Another excellent way of saving money on PayPal fees.

To sum up, give your customers a choice. You have to accept PayPal, but there's nothing to stop you offering these other quality alternatives discussed above. It won't cost you anything to sign up for them, and it may just give you a few extra sales both on eBay and your ecommerce website.

As usual, we strongly recommend you read all the small print before signing up.
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