Over at Quora, the subject of PayPal came up in the course of a discussion comparing US payment methods with those in Europe. Over there, checks are obsolete; electronic payment transfers are ubiquitous. Zelle is popular in Europe, as it is with major American banks. But credit unions do not exist there, and my credit union (which unlike a large bank treats its customers humanely) does not subscribe to Zelle.
One correspondent remarked, in praising Zelle:
Checks are so dangerous. You are handing people a piece of paper with your name, address, bank name and full account number, and at retailers they often notate your drivers license number and phone number too, and you top all this info off with your signature. Everything a fraudster needs!
Credit unions don’t offer Zelle. PayPal dings you a stiff fee for every transaction and will not allow you to transfer a client’s payment to your banking institution for three months after the client pays. Also, by claiming not to be a banking institution, PayPal evades regulation by US banking authorities….and as my own experience has shown, that is FAR more dangerous than checks. When they choose to rip you off, you have exactly zero recourse to the law.
Flabbergasted, another commenter added:
PayPal is essentially unregulated in the United States. It is not a bank. It is a privately owned corporation that can do pretty damn near anything it wants. And anything it wants is not necessarily in your interest. The complaints posted online at the Better Business Bureau — presently numbering 8,696, are just the tip of the proverbial iceberg. Pissed Consumer reports three issues resolved of 635 reviews, with $1.9 million in claimed losses. A whole website is devoted to publicizing PayPal’s outrages.
Here’s an alternative that might work for you: a reasonably low-cost system that accepts all major credit cards, with transaction rates that undercut PayPal’s, especially if your clients are overseas.