In 2015, eBay and PayPal broke apart into separate companies, and next week, the companies will be free of the constraints of the 5-year operating agreement under which they had been bound.
Despite the fact that eBay will place many US sellers into its own “Managed Payments” program next week, sellers continue to have questions about how the move will impact them.
“I don’t remember seeing anything about a FVF increase coming in July for eBay Store Sellers,” a reader emailed us last week. “Please see the link. Did I miss something or is this new?”
The answer: it is new. eBay revealed in May it is changing its fee structure to include managed payment processing fees as part of its final value (commission fees) – a radical change sellers are still trying to assess.
Another reader asked, “If I don’t sign up for Managed Payments, will all my then current listings be blocked on July 20th, or will they run til completion or sale? Or, will they be viewable, but not be buyable?”
eBay published the following FAQ on its website, and while it doesn’t address the specific points the seller raised, it does reference a “business interruption”:
If I don’t register now, what happens?
Managed payments is the new way to do business on eBay. eBay will manage payments for most sellers in 2020, and all sellers will eventually be required to have eBay manage their payments in order to keep selling on eBay. If you receive a notification, we encourage you to register before the communicated deadline, to avoid any business interruption after the deadline has passed.
Registration allows you to get your business ready early for managed payments. You can register in a few simple steps, including verifying your business information and providing a bank account. You will be able to track your registration progress on the Payments tab in Seller Hub.
On this July 5th EcommerceBytes Blog post, we wrote about questions sellers had about Managed Payments during the July 1st Weekly Chat session – some sellers were uncertain whether eBay had verified their bank account information and whether eBay had greenlighted them.
One week later during the July 8th chat, sellers continued to ask questions about the exclusion of bullion from Managed Payments, especially in light of PayPal’s User Agreement change removing gold from its PayPal Seller Protection policy, which we wrote about in this AuctionBytes Blog post.
“As you know managed payments is not yet ready for the coin category but the PayPal user agreement updates seem to take away seller protection from us,” a seller wrote on the July 8th eBay chat session.
During Wednesday’s chat, another eBay seller summarized some of the top concerns that remained about the Managed Payments program.
Registration: I registered but never got an email confirmation that bank account information I provided was verified, I called eBay MP and they said I was “good to go” – but again, never got an email confirming this. I would like an actual email confirmation saying my account info was verified.
MP Sign Up Incentive: MP was a sign up by July 15th or lose ability to sell on eBay. I Registered June 30th, a week later now eBay is giving people large credit offers for signing up – sorry, but I’ll take that credit also, and everyone else who has put up with eBay MP harassment past 3 months.
Private MP Community: I have no access, same with others, I would like access to the community to be able to further prepare for MP, seeing eBay said “more information will be provided after you register” – yet NO further information aside from the vague information already provided prior to registration was provided.
The seller’s post highlights how secretive eBay is being about the new payments program in some respects. eBay hasn’t published its new fees publicly on its website, and it won’t communicate openly with sellers about Managed Payments on the eBay discussion boards. Only if they are already officially enrolled in Managed Payments can sellers join a private board to get their questions answered.
On its Selling Fees help page, eBay displays the following message: “Managed payments sellers: Beginning July 18, 2020, the new fee structure for managed payments sellers will start to take effect. Please refer to our Selling fees for managed payments sellers article (only available for eligible, registered, or activated managed payments sellers) for information on the new fees and when they will apply to your account.”
Some sellers told us they are setting up new bank accounts to compartmentalize the Managed Payments funds. Upon registering for Managed Payments, one such seller landed on a page with the following notice:
You’ll soon get to experience a new way to sell and get paid on eBay. Once we confirm your identity and business info, we’ll email and notify you in My eBay Messages before activating your account for managed payments. When your account is activated, we’ll automatically update your buyer feedback and listings to reflect the different ways buyers can pay. Then you can enjoy all the benefits managed payments offers.
- No transfers needed
As items are sold, schedule your payout to your bank account at a frequency you choose (daily as funds are available or weekly).
- More ways for buyers to pay
Accepted forms of payment include credit, debit, and gift cards, Apple Pay, Google Pay, PayPal, and PayPal Credit.
- Simpler fees
You’ll pay one final value fee for items you sell on eBay, and you won’t have to worry about third-party payment processing fees. Your final value fees will be automatically deducted from your sales, and the balance of your sales paid out to your bank account. Most sellers can expect to see overall savings.*
*Savings based on annual total sales volumes, and comparisons of (a) prior eBay fees plus typical 3rd party payment provider fees, with (b) new eBay final value fees (without any 3rd party processing fees).
Sellers aren’t the only ones dealing with eBay becoming a payment intermediary – companies that create tools for eBay buyers and sellers are also impacted. In mid-June, Alyssa Cutright, eBay’s Vice President of Global Payments and Shan Vosseller, VP of Product of Payments, spoke to developers, the latter getting into some of the nitty-gritty of Managed Payments APIs, which we reported on the EcommerceBytes Blog.
Sellers can only hope that if they’ve registered for Managed Payments, they will continue to get sales and that eBay will correctly disburse funds into their bank accounts in a timely manner.
However, there’s indication many sellers are either waiting until the last minute to register or are refusing to do so. In early July, eBay felt the need to giving stragglers a $50-or-more incentive to induce them to sign up for Managed Payments ahead of the mid-July deadline (irking some of those who had not waited until the last minute, as you can read on the EcommerceBytes Blog).
That’s probably not what eBay’s former CEO had envisioned when he briefed Wall Street in 2018 about Managed Payments.
“It’s not going to be optional. We’re not going to hold peoples’ hands and beg them to move over,” Devin Wenig had said during his presentation at the 2018 Goldman Sachs Technology and Internet Conference. “We’re basically going to say your eBay account is now your full end-to-end eBay account for all your activities including payments. And that’s the way it works on every other marketplace.”
He got it right when he added, “Obviously the devil will be in the execution.”
Meanwhile his replacement, Jamie Iannone, who took the helm in late April, hasn’t communicated to sellers about managed payments or the imminent transition.