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eBay and PayPal Jump Payments Hurdle in Russia

Cash is king in Russia, so eBay and PayPal “have combined to launch a new payment service” on eBay in Russia in association with QIWI, which operates self-service terminals to help Russian consumers buy online as if using cash.

eBay expects the new payment option to help it grow sales, stating that an estimated 70% of all commerce transactions in Russia, both online and offline, are paid for in cash. “The new payment service is expected to open eBay to even more online shoppers,” eBay said in its announcement.

Bloomberg documented the challenge for eBay and PayPal in Russia last year in, “Cash-Loving Russians Give Qiwi an Edge as PayPal Looms.” It wrote, “Since 2008, Qiwi has offered a payment service similar to PayPal that it now calls Visa Qiwi Wallet in a tie-up with Visa Inc. The service has attracted 14 million users and is outpacing growth at the terminals, though the machines remain the bulk of Qiwi’s business, with more than 60 million customers.”

Beginning in early November, all Russian eBay customers will be able to pay for their purchases with QIWI Wallet. Customers can fund the QIWI Wallet using a variety of methods, eBay said: by cash in over 100,000 QIWI kiosks, via credit or debit cards, mobile phone balance or electronic money.

The head of eBay Marketplaces in Russia Vladimir Dolgov said it was a significant strategic milestone for eBay in Russia that demonstrated its commitment to making online shopping safe and convenient for Russian consumers.

He seemed to leave the door open to other payment methods, calling QIWI Wallet in Russia eBay’s first alternate payment option.

According to the eBay announcement, “QIWI Wallet can be used to pay for over 250 million items offered by cross-border sellers on eBay to consumers in Russia. PayPal supports processing of Visa QIWI Wallet payments so merchants will continue to receive seamless transaction processing and receipt of funds.”

eBay launched its Russian website in 2010 for international sales only, and opened the marketplace to domestic Russian sellers earlier this month.

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). She is a member of the Online News Association (Sep 2005 - present) and Investigative Reporters and Editors (Mar 2006 - present). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com. See disclosure at EcommerceBytes.com/disclosure/.