6 Online Payment Alternatives If You Hate PayPal

paypal alternatives title   6 Online Payment Alternatives If You Hate PayPalPaypal is the top dog when it comes to online payment services. It is generally easy to use and a relatively secure way to send money while buying products & services online (whether eBay or other online merchants), but it does have its downsides. The web is filled with folks who have had their Paypal account frozen with no explanation and it can severely impact a business (or person) if it affects you for a length of time.

Addressing the some of the downsides of Paypal, other businesses have ‘stepped up’ to provide their own payment services. They range from smaller startups to well established players throwing their hat in the online payment arena. Mostly the service that would work best for you depends most upon what you actually use online money transfers for. With Paypal, many people only use a certain aspect of it while never touching others. Let’s go over a few of these online payment services and check out the differences and why you might use one over another.

1. Venmo

venmo   6 Online Payment Alternatives If You Hate PayPal

Venmo is a Philadelphia-based startup in the mobile payment arena. Starting as a cell-phone based payment system, you can also send payment or a bill to a friend whom you have already connected with or to any cell phone, email address or twitter handle.

Much like Paypal, you carry a balance and your payments or charges credit and debit that balance. You add more funds by linking a credit card or bank account and Venmo uses bank-grade security throughout the transaction process.

Venmo started as a “Friend” payment service but you can also sign up as a business as long as you have a cell phone to coordinate payments. For Friend-to-Friend transfers there is no fee. Staff writer Steve is already a great fan of Venmo and I have seen its use expanding to more and more people.

Venmo is still invite-only but they were kind enough to set up a special invite code for MakeUseOf readers. Use ‘makeuseof‘ while signing up to gain access instantly.

2. Amazon WebPay

amazon payments   6 Online Payment Alternatives If You Hate PayPal

Amazon released their payments service back in 2008. Originally meant for merchants, they have also added a “personal” aspect to it named WebPay where you can send or receive money online or via cell phone. The Amazon Payments/Personal website has more details on the requirements for signing up.

3. Google Checkout

googleco   6 Online Payment Alternatives If You Hate PayPal

Google Checkout is definitely aimed at merchants more than anyone else. It takes the payment portion out of the transaction so that you simply send a buyer of your products to a checkout page which is powered by Google Checkout. When on that page, a buyer will enter their payment information – and then be sent back to your site with a confirmation of purchase.

4. Skrill / Moneybookers

moneybookers   6 Online Payment Alternatives If You Hate PayPal

Moneybookers is widely known as a replacement to PayPal which is also more international-friendly than some of the other providers. Moneybooks is beginning a transformation to Skrill – a rebranding and refocusing of their payment platforms. Their rates are usually cheaper than PayPal, but then again less people use it so that is the tradeoff you have. I’ve heard of a lot of folks turning to Moneybookers when PayPal has crossed them and they are mostly happy with their move.

5. 2Checkout

2co   6 Online Payment Alternatives If You Hate PayPal

2Checkout is a payment processor which acts as a “middleman” between you (as a seller of items or services) and the payer. 2Checkout can accept credit cards, checks, and even PayPal itself as a form of payment but ads a management layer as well handling the whole checkout process. I’ve seen many merchants using 2Checkout as a payment provider on eBay stores as an alternative to PayPal. There is a $49 signup fee; so this is mainly meant for those with some higher volume sales and not casual transactions.

6. Traditional Merchant Accounts

creditcards   6 Online Payment Alternatives If You Hate PayPal

Finally on the ‘merchant’ end again, you can do what other businesses have been doing for decades and apply for a real merchant account. Having a merchant account gives you, with the use of a payment processor such as Authorize.Net, the ability to accept credit cards directly. There are some downsides to this. There is often a monthly fee that the other providers above to not charge, and you must be PCI compliant which is a whole other issue. However if you perform a lot of transactions and need to integrate a payment solution into your own shopping cart or system, then this is the only way to go.

Ask your local bank about merchant accounts, alternatively there are a ton of options available online (check Google) but frankly there are so many options it is hard to tell from the web which will work for you. Ask your friends for recommendations and do your homework to make sure you are going with a reputably provider (I’ve used BluePay, and they have been good but fee-expensive).

Which One Is For Me?

The answer to this question depends a lot on how you use the online payment service. If you simply transfer money between friends – as a sort of IOU – then Venmo would definitely be my recommendation. If you are selling items to ‘strangers’ they might be put-off by Venmo simply because they are not well known, and in this case going with a bigger name such as Google or Amazon may work best. Finally if you are a high volume merchant or just do a lot of business, it would be wise to evaluate the other options to see what works best with you.

Do you have any other recommendations for PayPal alternatives or experiences with the ones above? Let us know in the comments below!

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32 Comments -

ZaiN

Thanks so much for sharing this. Much needed!
I only knew about Google checkout and moneybookers before reading this post.

Bakari

Cool. I didn’t realize Amazon had a web pay service. Thanks.

P. David Albee

Newest, most economical online/mobile payment alternative: Dwolla; http://www.dwolla.org

Mike

I want to add Click&Buy (http://clickandbuy.com/) to the list since it works for both iTunes and Steam* =)

* in a support controversy it turned out that Steam has a 150EUR monthly limit on Click&Buy

ZaiN

Thanks so much for sharing this. Much needed!
I only knew about Google checkout and moneybookers before reading this post.

Dave Drager

No problem ZaiN!

Bakari

Cool. I didn’t realize Amazon had a web pay service. Thanks.

P. David Albee

Newest, most economical online/mobile payment alternative: Dwolla; http://www.dwolla.org

Mike

I want to add Click&Buy (http://clickandbuy.com/) to the list since it works for both iTunes and Steam* =)

* in a support controversy it turned out that Steam has a 150EUR monthly limit on Click&Buy

Alek Davis

Amazon Payment was news to me. Can’t believe it’s free. Thanks. Btw, it would be nice if you noted which one of these have APIs or can be integrated in your own systems (similar to PayPal’s Instant Payment Notification).

Dave Drager

The more “Merchant” facing ones such as Google Payments, Moneybookers, and 2Checkout have APIs to integrate them with your shopping carts. The more “personal” based ones like Venmo and WebPay do not, as far as I know of.

Shade

Personal users on the Amazon system can only use the money to purchase items from Amazon.

Labinjan77

and Alertpay? I think it should be here on list too

Labinjan77

and Alertpay? I think it should be here on list too

Dave Drager

Thanks for the idea!

Anonymous

En Click And Buy?

Dave Drager

Thanks for the info on their site!

Saikat Basu

Amazon and Google are the ones who can take on PayPal and its virtual monopoly. As an Indian blogger we know the tremors we felt when PayPal and the national bank authorities clashed. A much needed post Dave.

Dave Drager

Thanks for the comment Saikat. It is true, when one company has majority power it is hard to ‘pay to play’.

Shade

Mt Gox does personal and merchant accounts. They handle transaction in BitCoins and in the US, accept credit cards to make USD transfers and payments.

Mt Gox pays out in USD.

http://mtgox.com/

(I have no connection with the Mt Gox enterprise except as a user)

Documaker

I hate Paypal! (to the tune of ‘I am Spartacus’)

But Payoneer’s working alright for me.

Shade

Mt Gox does personal and merchant accounts. They handle transaction in BitCoins and in the US, accept credit cards to make USD transfers and payments.

Mt Gox pays out in USD.

http://mtgox.com/

(I have no connection with the Mt Gox enterprise except as a user)

Just Outsourcing

I hate Paypal! (to the tune of ‘I am Spartacus’)

But Payoneer’s working alright for me.

Dave Drager

Thanks for the recommendation!

blair

what about Intuit ?? they have some cool stuff going on like their mobile phone payment setup GoPayments
http://payments.intuit.com/

blair

what about Intuit ?? they have some cool stuff going on like their mobile phone payment setup GoPayments
http://payments.intuit.com/

Jaykaran Sagar

Watch out for Paybox.me, the next biggest online payment service.
http://www.paybox.me/r/illumin

Justin Dupre

I’ve been looking for paypal alternative for sometimes now.. thanks!

Dave Drager

No problem Justin!

Liz Cornwell

You forgot to mention AlertPay (http://www.alertpay.com). I’ve been using it for quite a while and never encountered any problems.

Liz Cornwell

You forgot to mention AlertPay (http://www.alertpay.com). I’ve been using it for quite a while and never encountered any problems.

Anonymous

Have you tried the gateway provided by CheddarGetter? CheddarGetter’s probably best known as a recurring billing management system, but it just released its own payment gateway (CheddarGateway) this winter. It has everything you’d expect in a gateway (PCI compliance, fraud protection, QuickBooks integration, real-time reports, etc) along with a documented integration API if you would like more customization. But even if you don’t use the CheddarGateway, CheddarGetter provides recurring billing management services that can link to many of the major online gateways. I definitely recommend them!