Covering auctions, collectibles and marketplace selling.

Fri June 24 2011 21:10:53 |
PayPal Drops Interest-Bearing AccountsBy: Ina Steiner |
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PayPal is retiring its Money Market Fund next month. The Fund was launched primarily as an automatic sweep investment for uninvested cash balances in PayPal customer accounts. PayPal's spokesperson declined to answer our other questions as to whether there was any other way for PayPal account holders to earn interest on their accounts, and whether PayPal would earn interest when it placed holds on sellers accounts. What are holds? As PayPal explains, "When some sellers receive payments, we may hold the money in a pending balance for up to 21 days to help make sure that there are funds in the seller's account to cover potential refunds or claims. The funds may be released early if PayPal determines that the transaction has been fulfilled and customers are satisfied. While funds are pending, the money belongs to you but isn't available to spend or withdraw. If you're a PayPal Money Market Fund customer, you'll continue to earn interest on the total balance, even while the funds are held." In March, eBay said it would expand holds: "For sellers who don't meet eBay's minimum selling standards and sellers with little or no selling history, funds from buyer payments will be unavailable for a period of time to ensure successful fulfillment." A post from Smart Money magazine a few hours ago says that, as of Thursday, the fund held a collective $471 million and had returned 0.04% to investors so far this year, placing it among the top retail money funds. However, most PayPal users are not earning any interest on their accounts, PayPal is. According to the magazine, users keep roughly $2.6 billion in interest-free accounts with PayPal, which pools the funds and places in FDIC-insured accounts to collect the interest. "With quick transfers from a linked bank account, there's little reason to keep much more in your zero-interest site account than you need for planned purchases, (Bankrate.com senior financial analyst Greg) McBride says." |
Comments (38) | Leave Comment | Permalink |
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by: Hear that? |
Sat Jun 25 05:36:33 2011 |
Thats the sound of the ebay money vacuum sucking out every last penny from the dark recesses of sellers pockets. |
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Sat Jun 25 05:48:01 2011 |
PayPal’s “Money Market Fund” accounts were only nominally separate accounts anyway. PreyPal will still invest the bulk of the funds in a user’s PreyPal “bank” account on the overnight money market, only now they will keep all the interest for themselves (if they weren’t before); let’s face it, eBay needs all the income it can get to hold up its sagging bottom line. |
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Sat Jun 25 16:27:30 2011 |
@ Anonymous Annie, |
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Sat Jun 25 19:37:15 2011 |
@ Annie, |
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Sun Jun 26 19:15:20 2011 |
Colin Rule: From eBay Conflicts to Global Peace Initiatives |
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Sun Jun 26 19:48:56 2011 |
A comparison of PreyPal Money Market Fund returns with ING Direct, at |
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