eBay sellers can no longer use PayPal under new terms

New terms of use for eBay have come into effect which mean the online auction house will now pay sellers directly rather than through PayPal.

PayPal was acquired by eBay in its early days in 2002, and the two firms have worked in partnership ever since.

The changes mean that while eBay buyers can still pay with PayPal, sellers will be paid straight into their bank accounts.

But some sellers have threatened to stop using the service over the move.

EBay's forums have several posts from sellers who say they are reluctant to use the new system and give eBay direct debit access to their personal bank accounts.

But the new terms, effective from 1 June, say the new "managed payments" system is compulsory, and the company has the power to limit or remove listings from sellers who refuse to use it.

The company says the new system is simpler, convenient, and gives buyers more payment options - and the rollout will be gradual.

It marks a significant change in an almost two-decade partnership with PayPal, which split from eBay in 2015.

What's changing?

The managed payments system means that PayPal fees will no longer be added to the process, though eBay has made its own fees slightly higher.

But the company claims most people will pay the same as - or less than - before.

The new system is 12.8% of the final amount including delivery, plus 30p in the UK ($0.30 in the US). The old system was 10% for eBay, plus PayPal's fees, plus 30p. The difference favours the new system to the tune of pennies for most transactions.

The move also means that buyers will automatically have access to every payment option available - including credit and debit cards, Apple Pay, Google Pay, PayPal, and PayPal Credit.

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However, payments will now take two working days to be transferred, while PayPal was usually on the same day.

The feature has been rolled out since about 2018, an eBay spokesperson said - with business sellers moving first. An estimated four million sellers are already using it.

The deadlines for all users are phased - so while many sellers are required to move to the new system from 1 June, others will receive a message from eBay in the coming weeks and months.

What's the problem?

The terms and conditions make using the new system mandatory.

In part, the reluctance is because eBay has a strong reputation for protecting buyers - sometimes at the expense of sellers. Some unscrupulous fraudsters have been known to buy a product on eBay, swap it for a damaged or different item, and return the package demanding a refund.

Some sellers believe eBay regularly sides with the buyer in such cases - and fear that refunds would be taken out of their bank accounts under the new system.

Late last year, ahead of the impending change, another forum user wrote: "They are so heavily biased in the buyer's favour... I am simply not prepared to switch to this new [system] and give eBay direct access to my bank account."

EBay, for its part, says the direct debit scheme adheres to the same rules any other direct debit, such as a phone bill. That means customers will have advance notice of how much is being taken out, and any incorrect or fraudulent payments should be refunded.

Other users were confused by the switching process requiring them to enter their online banking usernames or passwords. But those credentials are only used by the bank. The company says it does not have any actual direct access to sellers' bank accounts.