EcommerceBytes-NewsFlash, Number 2763 - March 19, 2012     1 of 3

Sellers Choice Awards 2012: Rating Online Payment Services

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Four services came out on top in the second annual EcommerceBytes Sellers Choice Awards for online payments: Google Wallet, Amazon Payments, ProPay and PayPal. This year, participation was limited to the 20,000+ subscribers of the EcommerceBytes Newsflash newsletter, and 2,415 readers rated the online payment services with which they had experience using. The survey follows on the heels of the third annual Sellers Choice Awards for online marketplaces, conducted in January and published on February 5, 2012.

2012 Sellers Choice Payment Services Ratings

Fee Structure Resolution Process Account Holds, Rolling Reserves & Restrictions Customer Popularity Recommend Overall Rating
Google Wallet 7.4 7.1 7.6 6.0 7.4 7.1
Amazon Payments 6.9 6.7 6.7 7.1 6.9 6.86
ProPay 6.8 6.7 7.5 5.2 7.0 6.64
PayPal 5.4 4.7 4.2 7.5 6.0 5.56

EcommerceBytes sent an invitation to Newsflash subscribers and asked them to rate eight payment methods: Amazon Payments; Dwolla; Google Wallet; PayMate; PayPal; ProPay; Skrill (MoneyBookers); and Square. PayPal was the method used by the overwhelming majority of respondents (98%). One reason for the high adoption rate cited by readers was because they are forced to accept PayPal when selling on eBay. A second reason became apparent when sellers were asked to rate the popularity of payment services among their customers: PayPal came in first with a 7.5 out of 10 rating. And while respondents said some of the other services were difficult to implement, some cited PayPal's ease of use as an important benefit.

But despite PayPal's high adoption rate among respondents, Google Wallet was rated most highly among the top four services for three criteria - Fee Structure; Dispute Resolution process; and Account Holds, Rolling Reserves and Restrictions. Google Wallet was also rated most highly among the top four services when sellers were asked how likely they were to recommend the service to a friend or colleague (7.4 out of 10).

Other Forms of Payment
When respondents were asked what other forms of payment they accepted, 67% said they accepted paper payments (checks, money orders and/or postal money orders; 56% said they accepted cash; 26% said they accepted credit cards; 12% said they accepted bank-to-bank transfers and wire transfers; and 2.1% said they accepted a mobile payment service.

When asked to comment about which forms of payment they accepted, some respondents stated they accepted other payment methods including Western Union, and ppPay. Others took the opportunity to share thoughts, such as the reader who wrote, "Our customers by far seem to prefer using their credit card through a Merchant Account without being directed to another site to make their payment," and "Currently I only accept traditional (Cash/Checks/MoneyOrders) payments plus PayPal. However we are actively looking to expand beyond PayPal and include more like Money-bookers and Google Wallet."

Google Wallet
Google Wallet (formerly called Google Checkout and now encompassing Google's mobile payments offering) came in first place of the top four services. Its lowest rating was for Customer Popularity (6.0 out of 10), and its highest rating was for "Account Holds, Rolling Reserves & Restrictions" (7.6). Numerous sellers expressed a desire for Google to add a way for merchants to automatically print shipping labels after payment.

Reader Comments - The Good, The Bad, The Ugly:
"They don't have a way to process the shipping label after payment. This is a real negative for a one person business."

"One thing I don't like is that Google automatically deposits my balance. It makes it a pain to keep track of the money going in and out of my bank account. Since it is always empty, I don't bother with it and use PayPal instead."

"This service is pretty good it just needs smoothing out with respect to the dispute process. At one point I had a conversation with someone from Google, and they just don't appear to have the same level of experience as some of the other entities in this area."

"Google Wallet is my preferred method of payment, and I wish more buyers would use it. I do wish they had telephone support. And although it hasn't happened to me, I've heard from other sellers that Google closed their accounts for no apparently good reason and without any warning whatsoever."

"I don't care for it as it doesn't just give you the money in an account, you have to go accept the payment then you have to make your own label. I find it clumsy and not efficient."

Amazon Payments
Amazon Payments came in second place among the top four services. Its highest rating was for Customer Popularity (7.1). The criteria with the lowest marks were for Dispute Resolution process and Account Holds, Rolling Reserves and Restrictions, both tied at 6.7. A number of respondents said it was too complicated to set up Amazon Payments.

Reader Comments - The Good, The Bad, The Ugly:
"Amazon costs more, but it is worth it. Best thing I ever did for my business."

"This is a headache to set it up to whatever online merchant store, just terrible instructions to how set it up. Last time gave me migraine."

"I wish you could print postage from Amazon Payments it would be easier on all. Maybe that is something that could happen in the future."

"Have tried a few times to sign up for this but it is too complicated so was never successful."

"We have never faced issues of account holds as we are quick with our resolutions with our customers if any - no bad experiences so far."

While ProPay came in third among the top four online payment services, it has the lowest adoption rate of the four, and it rated only a 5.2 out of 10 in "Customer Popularity." It earned highest marks for Recommended Service (7.0).

Reader Comments - The Good, The Bad, The Ugly: "Joined ProPay at its inception and have been very happy with them - except this year when they suddenly stopped offering the Basic membership and raised the price of the next tier to almost double. No problems with account holds. One dispute resolution was handled perfectly. As to customer popularity, I doubt many customers know the company's name - all they see is my business name on their credit card billing. I'd heartily recommend."

"Propay is not supported by eBay's shopping cart so I will be forced to drop it, as I am not allowed to advertise Propay if I want to participate in the shopping cart."

"Fees are higher than PayPal, I have only had a couple of dispute and they always went in favor of the buyer."

"Really like this service, they need more consistency with respect to policies."

PayPal came in fourth among the top four online payment services, though it was the most widely adopted among the eight payment service included in the Sellers Choice survey. PayPal earned its lowest grade for "Account Holds, Rolling Reserves & Restrictions" (4.2) and its highest for "Customer Popularity" (7.5).

Reader Comments - The Good, The Bad, The Ugly:
"Since we sell everything on eBay, we are required to use PayPal. If we have a local buyer, we accept cash."

"I've been selling online since March 2006 and have always been very happy with the Paypal service. No problems at all and I would be happy to recommend Paypal."

"I feel PayPal is nothing more than a scam. The fees are outrageous when used with Ebay. I quit selling on Ebay some time ago and am happy I did and do not miss it at all."

"Even with it's faults, it is easy to use which makes it my number one payment choice."

"They restricted my account once in 2 years and that was a VERY frustrating experience, even though supposedly it was for my own fraud protection. I know several others who have had restrictions placed on their accounts and all were frustrating experiences. I've heard so many horror stories about how they treat people and their accounts. If they weren't so big and the ONLY option in Etsy, I wouldn't use them. Glad to hear Etsy will start offering a new option soon!"

"Have had very few issues with Paypal i.e. disputes, no holds etc so had to rate it as neutral- I know many others are not happy with them on these issues. Use them exclusively as our credit card processor and have for 7 years."

"They find any reason to hold your funds which when you are working with the customer allow the seller and buyer to work it out not have PayPal immediately decide for the seller."

"Fees are excessive, we are already paying eBay why do we need to pay PayPal to, they are providing a front for eBay."

"Any and all dealings I have had in telephoning PayPal have been excellent, at least you don't get the rote that eBay provides."

"Sometimes I don't get emails on payment notification. Sometimes payment notifications are very slow. Dispute resolution process is vague and uninformative as to status details."

"It has its problems but it is still the most recognized name for online payments with customers. They are not aware of the problems seller have with Paypal. Customers feel it is the safest and most comfortable way to pay for online purchases as they do not have to give out their credit card information. Would like to find a replacement but nothing stands out as a better and most important - well recognized and accepted by customers. We will keep looking and hoping for a replacement."

Dwolla, PayMate, Skrill and Square
There were too few readers who rated Dwolla, PayMate, Skrill and Square to include them in the final chart. Dwolla and Square are new payment services and have different models than traditional online payment services, while PayMate and Skrill are more popular overseas (Australia and Europe, respectively).

PayMate earned its lowest mark in Customer Popularity with a rating of 2.8, and its highest marks in Fee Structure and Account Holds (4.5).

Skrill (formerly known as MoneyBookers) earned its highest mark in Fee Structure (6.7) and its lowest mark in Customer Popularity (4.2).

It's worth noting that respondents who rated Square rated the service very highly, particularly on Fee Structure (8.1) and as a service they would recommend to other sellers (8.6). However, Square is designed primarily for in-person credit card processing. Its lowest mark was for Dispute Resolution (7.2).

Dwolla's highest rating was for Fee Structure (7.2), and its lowest was for Customer Popularity (4.1).

EcommerceBytes conducted the first Sellers Choice Awards for online payments in 2011, you can read the results in this March 6th article from last year.

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About the author:

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). Follow her on Twitter at @ecommercebytes and send news tips to

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