eBay is becoming a payments intermediary just as Etsy had, meaning instead of paying sellers, buyers pay eBay, which then disburses funds to sellers' bank accounts. However, many sellers prefer the old way of having buyers pay them directly so they have instant access to funds in their PayPal accounts.
PayPal is proposing a workaround called Direct Deposit, though it appears it may only be available to sellers who participate in its PayPal Working Capital loans program.
Sellers still wouldn't get instant access to funds, but they could have eBay and Etsy disburse funds directly into their PayPal accounts if they preferred, eliminating the extra step of transferring funds from their bank accounts to their PayPal accounts.
PayPal sent a survey to sellers describing the hypothetical Direct Deposit feature and stating, "Since your marketplace sales aren't processed through your account with PayPal, you can't automatically repay your PayPal Working Capital business loan. That could make it harder to be approved for a loan down the line. But don't worry, we've got you covered with PayPal direct deposit."
Among the benefits of the hypothetical service the survey described is the following:
"Fast access to your sales without fees.
"Once eBay or Etsy processes your sales, your funds will be available in your account with PayPal in 1 to 2 business days. There are no transfer fees or any other fees."
The key benefit PayPal is proposing is the ability to stay compliant with PayPal Working Capital loans. A seller who received the survey explained that PayPal Direct Deposit is basically a unique routing number that sellers could provide eBay and Etsy. "PayPal would draw off a set percentage to pay Working Capital loans," the seller said.
The seller shared further thoughts about the proposed PayPal Direct Deposit offering as described in the survey:
"For people who need their funds coming from eBay or Etsy to end up back in their PayPal account, this could be a fast lane to that result. Without this, your funds end up in a bank account and then you have to move them to where you need them. Could be a few business days on the transfer. And likely some people would have to open a separate bank account to have a buffer between their "real" account and the marketplaces. With this Direct Deposit, the funds flow through your PP account first.
"Either way, you have to wait for the marketplace to post your funds, but instead of being in a bank account, they would be in a PayPal account and maybe provide more options and flexibility.
"Sounded like a possible solution to the problems people have been discussing lately regarding Managed Payments. We'll see if that proves to be the case."