The Guardian today reports on the potential pitfalls of allowing collection of items paid for with Paypal, highlighting the gap in seller protection compared with – say – items sent by recorded delivery. Happily for the two people whose cases were brought up in the article, Paypal have made a goodwill gesture to cover their losses. But what can the rest of us do to protect ourselves from this kind of fraud?

The first thing to note is that this sort of thing is extremely rare, and isn’t something to panic about.  In the past eight years of trading, I can count on one hand the number of instances where we have experienced this sort of fraud on collection items, and in most cases it has been with payments made by cheque. Paypal seems to be more secure than traditional payment methods in this regard – on the whole, the benefit it offers in reassuring buyers far outweighs the risk of fraud.

Moreover, the news that Paypal are going to work closely with law enforcement is most welcome: being able to trace online fraudsters through their digital footprints one thing that keeps this channel more secure.

For our sellers, they were protected by our guarantee and so they got paid in any case: this peace of mind is all part of our service. But what can you do if you are trading directly and have some large one-off transactions like the sellers in the article?

Paypal is a required form of payment for all eBay transactions, and some items can’t simply be popped into a Jiffy Bag and posted.  Indeed the strength of eBay over many other e-commerce platforms is its ability to handle the larger and more exotic one-offs which require specialist handling and which are often collected in person.

The first line of defence is your intuition about a transaction. Is it for a large amount?  Is the buyer a new or recently returning user or showing unusual activity in their recently purchased items?  Are they particularly pressing for an urgent collection?  Is there anything about their approach which suggests something just isn’t right?  Any of these things might put you on a more suspicious footing about a transaction - obviously the more experience you have, the more likely you are to spot something out of the ordinary.

The second is to have good procedures for collections. Ask the buyer to identify themselves (genuine buyers won’t mind bringing some ID along with them) and take a note of the car registration in which they arrive.  Ask them to inspect the item fully and get a signature to confirm the item is the one they have bought. This will also minimise the number of returns which occur -particularly troublesome with larger items.

If you are running a warehouse, then ensure that your CCTV cameras cover the areas where transactions are made and items are loaded and can record faces and identify vehicles. All these steps will help deter fraudsters from believing that they can get away with the crime.

Finally, if you can’t satisfy yourself that the buyer is a trustworthy and reliable party, then be prepared to refund the payment and cancel the transaction if they can’t prove that it is genuine. No matter how much you want to make the sale go through, you have to remain objective in your assessment of whether it really is genuine.

Above all, remember that by far the vast majority of buyers are decent and honest folk. I really enjoy meeting the wide array of people from all walks of life who come and collect from us when they indulge their passions on eBay.

Watching BBC Breakfast news this morning, it’s been reported by Paul Lewis of BBC R4′s MoneyBox that Paypal is unable to comply with the new EU law requiring electronic bank transfers to arrive in the recipients bank account by the following day. Paypal say they will not have the system in place until later in the year so it will still take 2-3 working days for money to transfer. Paul Lewis advised people who have complaints regarding Paypal (who declined to comment on the programme) and these later payments should contact the Ombudsman. Pod cast of programme here (article 6:35 in Paypal 11:38 in)

I have to ask why Paypal didn’t get this sorted out in time and why they should be the exception to the rule of law? I can’t think of any excuse, if other financial businesses managed to sort it in time why haven’t Paypal? Oversight? This just isn’t good enough, perhaps the amount of interest they will gain by late implementation of this should be forfeited. I would be interested to see what happens on this one and if anyone claims compensation via the Ombudsman. Rather embarrassing for Paypal methinks.

Update, Monday 9th January 2012, 14:56pm.

This comment was supplied to us by PayPal today:

PayPal customers can already send money between PayPal accounts almost instantly – these payments already go well beyond what is needed under the new rules.

For payments outside the PayPal system, we’ve already implemented changes across the EU, except in the UK, that meet the new European standards for faster payments.

We are in the process of implementing Faster Payments in the UK, to allow PayPal customers to move money from their PayPal account to their bank account. Of course PayPal will only be able to use this method of transfer when the customers bank supports Faster Payments – a number of UK payment service providers are not yet able to receive Faster Payment transfers.

Within the UK, the process of implementing Faster Payments has been more technically challenging, which unfortunately has delayed our launch. However, we are planning a phased launch later in the first half of 2012.

The way we are implementing Faster Payments in Britain is significant. We are in the process of becoming the first ever “Direct Agency” member of the Faster Payment scheme. This will mean that although PayPal is not a UK Bank it will give its UK customers the same almost instant real time money transfers to bank accounts as offered by UK banks in the Faster Payments scheme. Other organisations use the Faster Payments system in a different way, delaying the transfer of funds by a number of hours. PayPal took the decision to be the first non-UK bank to provide near real-time transfers to give our customers the best possible experience. Unfortunately building and testing this has been significantly more complex and lengthy than expected, which is why we have not met the January deadline. However, we are working very closely with the Faster Payments scheme and our sponsor bank to complete the project, while ensuring the system works well given the large volume of payments handled by PayPal on behalf of its 14m UK customers. It will also mean that PayPal customers enjoy a far faster service than the new rules require.

We have explored other options in order to meet the January deadline. Unfortunately, using Britain’s traditional faster payment service, CHAPS, is not practical given PayPal’s scale – CHAPS is designed to handle a small number of high value transactions, rather than PayPal’s large number of relatively small value transactions.

Yesterday, an unnamed reporter for the Daily Mail reported online that PayPal apparently ordered an eBay buyer to destroy what is claimed to be a $2500 antique violin so that the buyer could claim a refund.

The seller known as Erica is distraught. The PayPal blurb offered as proof and displayed doesn’t seem to require the destruction of the violin and the Daily Mail got this story from regretsy.com, it seems.

Have a read of it and ask the question: “who’s on the fiddle?” More violin puns please.

Richard Brewer-Hay of the eBay Ink blog, reports an email that has been sent to all Paypal staff. It’s the usual corporate guff.

At Le Web X.Commerce announced a raft of new developers taking the X.Commerce pledge. One of our favourite developers, Stephen from Tradebox (the guys that make your marketplace and website accounting integrate with Sage), told us that every time eBay add a web technology to X.Commerce that gives them access to broaden the scope of what they can do for merchants. Because X.Commerce are using one platform with standardised code they’re really looking forward to getting to grips with it and integrating with more partners and are excited for the future.

Others such as Ed Monyneux from Freeagent said that the X.Commerce has the potential to become the holy grail of truly standards based integration across every kind of ecommerce function. He’s right – and I foresee a future where merchants no longer need to complain about the shortcomings of their chosen multi-channel management platform. Currently you have to select a platform based on the best fit for your needs, but there are always a couple of features missing that you wish you had. Now merchants will be able to select a main platform and simply add in a couple of “plug ins” from other developers to complete the solution that they require.

The Integrator Opportunity

Of course you could do away entirely with a multi-channel management solution and simply buy a plethora of X.Commerce plug ins to do the job for you. However I foresee that this will make management difficult and many merchants will still be better off with a fully featured solution with a single log in to their management platform and a single point for support.

Integrators such as Pentagon Interactive, Genie and the Geek and Imonline will be well positioned to provide managed services by using a selection of X.Commerce enabled solutions to truly tailor a solution on behalf of their client merchants. These companies use third party software in order to provide a full service offering to their merchants and X.Commerce will open the doors for them to provide an even more custom tailored solution for their clients.

The newest X.Commerce partners announced at Le Web

The big advantage of PayPal Access is that shoppers don’t have to key in shared information such as their real name, shipping address and email address every time they make a purchase from a new website. They can authorise PayPal to share this data on their behalf. “Smart” profiles present a more stream-lined experience for customers and enable merchants to provide personalized shopping experiences for their visitors. This inspires customer loyalty, which leads to increased sales.

PayPal Access will be installed on Magento Go stores as an extension which means that merchants can enable it in just a few clicks and of course it will then mean that PayPal take a cut of every transaction. That brings me to the point of eBay’s strategy in making X.Commerce an open developer platform… In doing so eBay could win a huge slice of revenue in the form of PayPal fees. Of course that won’t happen all of the time – there’s nothing to stop developers integrating other payment methods.

X.Commerce is intended to join the dots in on-line and off-line commerce and enable not only all of eBay’s properties to be connected but also every developer’s non-eBay property as well. This can include EPOS systems enabling off-line inventory to be easily displayed on-line on websites and marketplaces (such as, but not limited to eBay).

Having a common X.Commerce interface allows credentials to be shared and used across services from multiple developers and will in the future give integrators the ability to more easily build custom solutions to fit their clients needs and merchants the ability to market their products more effectively.

In the first article I wrote about X.Commerce I said that there was nothing much to see yet that’s of interest to merchants. That’s still true but every website owner, eBay seller and off-line retailer out there should be keeping a close eye on developments and talking to their software suppliers and developers to ensure that when solutions are ready that they are amongst the first to take full advantage of the new technology coming down the line.

Oliver Prothmann and founding chartixx

It was in Richmond in September 2009, when I was there for two weeks as the EU Coordinator PayPal Business Seller on eBay, that the time came to start a separate project for the online retailers:

In the seven years prior I had worked closely with business sellers on marketplaces. I launched the T-Online-Shop (electronic shop of German biggest Internet provider) on eBay and Amazon and then brought in the sales department of ElectronicScout24 (subsidiary of T-Online) and in particular the CRM system and managed the sales team.

In 2006 I started at eBay Germany Seller Development Team and built up the account management team. Does anyone remember to eBay Express? I was at the time Head of Sales but, unfortunately, the product was turned off too early. Then in 2007 I moved to PayPal to build the Marketplaces team and was also responsible for the business sellers on eBay.

The most intensive contact I had with the online retailers was in 2008 in preparation for compulsory PayPal on eBay. It became clear at this time that the dealers have a great need to evaluate and analyze their metrics on eBay. In April 2010 I founded the company Applet-X GmbH and started with the development of chartixx, the first business analysis tool for online retailers. My goal is to help retailers have better business information.

What can chartixx do for you?

chartixx brings the business transparency they desperately need for online retailers, on marketplaces and other channels. Today, it’s really not about multi-channel but rather multi-platform business. But each platform the retailer uses only shows different metrics on the sales and developments and only for that platform. For example eBay provides its online retailers only the data from one eBay account and not all accounts held by a retailer. chartixx wants to make the analysis simpler and clearer, so that the retailer can focus on what matters most – increasing sales and revenue.

Why it’s important sellers know their stats

Only those who know their numbers, know their business. e.g how dependent are you on your bestsellers? If your top 10 bestselling items account for 15% of total sales, the danger when sales of one drops is less than when they represent 60% of total sales. chartixx profiles show quickly whenever there are fluctuations or dips and the dealer can take countermeasures quickly.

It is also important to have the format mix under control. Knowing your metrics also means having the numbers to know how to stay on or get the Top Rated Seller Standard.

chartixx is not about research of marketplaces. chartixx is about knowing your own business and seeing the potentials and risks.

How sellers can keep on top of their stats?

With chartixx the retailer´s financial results are always at hand. chartixx will offer a perfect view on the metrics, either on the desktop as an optimized display on mobile devices and as an app for iPhone and iPad, Android will follow soon. Thus, the retailer has access to all their business metrics at any time.

You’ll need to link chartixx to give access to your marketplace data, but that’s just entering a few data connections. chartixx uses but does not store retailers passwords, it uses tokens for each platform – data security is chartixx’s highest priority.

Instant access to Business Intelligence and KPIs

The big advantage of chartixx is that everything is instantly available. There is no waiting for data downloads and no need to select the data for analysis. chartixx provides the online retailer with ready prepared up to date metrics instantly available. In chartixx the retailer only needs authorise connection to the marketplaces they trade on and then they have access to the data analysis and trends in Chartixx.

chartixx is always up to date as a SaaS (Software as a Service) application, the retailer will always have the latest version of chartixx in use. Almost every month new analysis and interfaces are added and these can then be used immediately without any upgrades. Currently chartixx supports data from Amazon, eBay, PayPal and Google Analytics.

To access chartixx you only pay for what you use and it starts from as little as €5 per month for chartixx business intelligence.

As well as paying for goods without having to queue, the report reveals shoppers can look forward to being able to carry digital loyalty cards, promotional offers and receipts on their phones – keeping everything in one place creating a virtual shopping hub.

PayPal’s findings are based on Forrester Consulting interviews with 10 senior executives from major UK retailers and other businesses, representing a combined 2010 turnover of £85 billion. 45 million Britons use a mobile phone and over a third of mobile users surveyed by Forrester have used the mobile internet to buy something from a retailer’s website. In the future a whole range of devices will be used to make payments direct to the retailer – regardless of whether you’re in store or shopping online.

This isn’t just wishful thinking – back in June of this year Pizza Express rolled out an iPhone app allowing their customers to pay for meals via PayPal. Mind you there’s still a long way to go. The coffee shop I visited today they don’t even take cards and are still strictly a cash based business. Thankfully they spare you the embarrassment of not being able to pay for your cake and tea by telling every customer up front but you have to wonder how they’ll cope with accepting PayPal or indeed any form of mobile phone payments.

There’s also the tricky problem of security tags and the embarrassment of a security guard accosting you at the door because he didn’t see you pay at the checkout. However those problems aside I’d love to go shopping for Christmas presents and just scan and pay for products with PayPal on my mobile and have them automatically delivered to my home – shopping with no bags to carry has it’s attractions.

PayPal said on Twitter this afternoon: “We are actively working with Royal Mail to have this issue resolved. Any new updates will follow.”

At 5pm today (Monday 21st November), PayPal said on Twitter: “Sorry no update as of yet on the Royal Mail printing label issue. My apologies for any inconvenience. We are working on it.”

We’re not sure exactly what the issues are, or if they are universal and affecting all users, but this is obviously not great news. A glitch on a Monday is always a bane but in November, peak selling time, this is going to be very inconveneient for sellers who use it.

You can keep an eye on Twitter for the latest updates from PayPal here.

A beta was launched this week and the full service will roll out in the new year. The service is extremely similar to PayPal at first glance and Visa will be targeting ecommerce at launch. With V.me, users have an account accessed by a username and password. The account can be topped up by various sources such as credit or debit card or bank account and there will be no need to type in a card details each time of use.

To accelerate adoption of V.me, Visa has also launched a developer programme that includes the company’s other properties Authorize.Net, CyberSource, Fundamo and PlaySpan. It is hope this will encourage retailers and developers to develop services, especially to power mobile commerce.

This is certainly an interesting development and one that could be start of a serious challenge to PayPal’s long held dominance in the online payments market. It’s slightly surprising that Visa have sought to brand it as V.me, not least because that’s not a very engaging brand and also because Visa itself is a very clear and trusted brand in itself already.

There is no word on what V.me will cost to retailers and ecommerce SMEs. There is also no detail as to whether it will be accepted on eBay or Amazon although it seems unlikely.

In many ways what that film didn’t foresee was the rise of the web and the internet, digital connectedness and all the data gadgets we would have. Even a far future Tricorder from Star Trek looks a bit cumbersome to me.

But rest easy, you may not have your jet pack, but you can pay for things via your telly box now thanks to a partnership between PayPal and Capablue. If you use the Capablue Connected platform.

As Internet Retailing note, we agree that this is only for making small payments for TV content in the short term, but it is a great of example of how PayPal’s unstoppable tentacles continue to shimmy out into the world.

And how long will it before you can sit there watching your telly and just click a button during an advert to snaffle whatever item is being pimped, using the doofer? I can see definite immediate benefits for people who like a delivered pizza. But the possibilities are endless.

So, if you have a PayPal account, all you have to do is log in and select what you want up to the total of £5k and they’ll pop you in the draw. There are also daily draws for £200 prizes.

All the blurb and details can be found here.

So the Monday before last I sent money from my bank account to my PayPal account. The money arrived the subsequent Monday at some point in the afternoon.

I’ve never really understood why it takes 5 to 7 days for funds to whizz from my bank account to my PayPal account. Even back in the deep darks days of 2004 (when I dimly recall the feature launching, but don’t quote me on that), it was too long. But in the age of super fast payments and the like, I have no idea why it shouldn’t be instantaneous or at least within the hour during the day.

Has anyone got any idea why it does take so long?

That’s pretty much saying eCheques are an out-dated defunct way to pay and about the slowest form of payment you can get. Mind you I already knew that and so did my buyer because they sent an email saying “Hi, I paid using eCheque because my credit card expired, but if you cancel this payment then I can pay using instant payment”. Result – I’ve now got the funds available in my PayPal account as my buyer is on the ball.

For me that buyer message sums up eCheques – sellers don’t like eCheques. Buyers don’t like eCheques. eCheques are a waste of everyone’s time. Certainly if a buyer’s card expires give them options to pay by any method other than defaulting to an eCheque. Why don’t PayPal point out at the time of payment “If you don’t add a new funding source you payment won’t clear until 10 days time”?

If no one likes eCheques then why aren’t they retired like paper cheques very nearly were?

Gumtree Deals had an offer that essentially meant that you could buy a £15 PayPal voucher for £5. Not quite ‘free’ money but not far off. We hope to see more of this type of promotion, because it’s pretty much “quantative easing” for the eBay economy. £100k of PayPal (?) marketing cash that should hopefully go predominantly to eBay sellers.

We’ll keep ‘em peeled for a repeat.

To comply with banking requirements merchants will have to go through some additional verification adding banking details to PayPal, but that’s a small price to pay for the many merchants who want to export precious stones and diamonds, higher value hand-made jewellery, leather products and ethnic Indian clothing to the rest of the world.

eBay have around 2.5 million users in India and 12-13,000 sellers who rely on the site for some or all of their income. Look out for some new listings on eBay for the goods they’ve not been able to sell for the last year.

With the Pilot once a purchase has been made eBay will request payment from the buyer and once eBay has the funds they’ll notify the seller that the item should be despatched. The seller then needs to ship the product and when they mark it as despatched this triggers the payment from eBay to the seller.

The big deal on this test is Buyer Protection. Currently buyers are protected for their purchases if they pay with PayPal. Under the pilot with eBay collecting the funds all acceptable payment methods will be covered under Buyer Protection. Buyers have the option to pay with Bank Transfer, PayPal, Skrill (the new name of Moneybookers) or credit card/debit card through either PayPal or Skrill.

As a side benefit the pilot will also ensure that a wider range of payment options are available to buyers on a consistent basis. All sellers participating in the pilot will have the same set of payment options offered on their items so buyers will always have the choice of using their favoured payment method.

All newly registered sellers on eBay.de and eBay.at will be included in the payments pilot. All of their items listed on eBay will have direct payment options to eBay which means buyers around the world buying from these sellers will see the range of eBay payment options.

Payments from eBay to the seller can be either through PayPal or bank transfer, and similar to current PayPal holds the frequency will be dependent on the seller status including if they are a business seller with an established trading history (immediate payout) or Business seller without a trading history or who are below standard (7 day payout) or Private sellers (14 day payout).

eBay say that it’s too early to say if the pilot will be rolled out to more sellers or in more eBay territories. They will of course thoroughly analyse the results of the pilot to determine if it has the desired effect of increasing trust on eBay, particularly for higher value purchases from newly registered sellers.

I do like the way the new payment model offers choice of payment methods to buyers and increases buyer protection. I’m not so sure that sellers with their own merchant banking facilities for accepting credit/debit cards or those who already accept bank transfer will welcome delays in receiving their funds.

However the most important data point from the pilot will be to see if it increase the frequency and value of purchases from buyers. If sales volume and value increase than any change in payment options is likely to be a secondary consideration and something we’ll all just have to live with.

Since the futuristic PayPal “Zombie Apocalypse” video PayPal community members have been busy making more spoof PayPal adverts.

Today’s instalment “No pockets required” is slightly risque, but amply demonstrates the benefits of how we may use PayPal in the future without even a mobile phone. I’m sure the choice of using a reasonably attractive lady in the video won’t do any harm to it being viewed hundreds of times, but you might not want to click the play button at work.

Edited to add: It appears PayPal have made the video private. Maybe someone decided it’s a little too edgy. Not to worry, here’s an alternative viewer

Edited to add: PayPal have pulled this video yet again, but for the moment you can still view it on poptent.net/

I have to say I can totally understand that this video is off-message and why PayPal bigwigs might not approve of it. However once it had been published on the PayPal Blog it was a bit late in the day to go pulling the video from YouTube, hiding the post on the PayPal Blog (unless you know the URL) and deleting Twitter Tweets. It just makes them look silly and they’d be a lot better off just leaving it be and burying it with a load of new videos and blog posts.

Trying to hide what’s already published just makes people want to watch the video even more

Researchshowed that 72% of Britons believe running costs eat up a significant amount of their donation and 65% admit that they are put off supporting charities because of these costs.

100% Giving was first trialled in February. Ordinarily, for every £1 donated to Oxfam, 81p goes directly to programme work, while 19p is spent on essential running costs such as training a staff member to work in extreme conditions, or delivering vital aid in emergency situations. However, throughout September 100% of every donation made via PayPal, will go directly to Oxfam’s lifesaving work worldwide.

For the whole of September, for every £1 you donate, PayPal will donate the 19p to cover all admin costs on donations made through PayPal meaning 100% of your donation goes directly to the the cause and none of your money is spent on administration.

All donations to 100% giving must be made via www.oxfam.org.uk/100percent during September.

We asked PayPal who told us “PayPal has a strong and growing business throughout Europe, and Russia is an interesting market where we’re seeing a lot of demand for localized PayPal services. Beyond that, we’re not discussing any specific information about our future growth plans in the region.”

To be honest I wouldn’t be surprised if PayPal did open an office in Russia – it’s a big country and to become a world leader in the payments industry then PayPal are likely to be eyeing up many new territories and looking to exploit them. Russia would be the ideal base for an office to service much of Eastern Europe from.

It’s only in the last five years that PayPal have started to allow Russians to use PayPal, prior to that it wasn’t unusual for PayPal users holidaying in Russia and checking their PayPal account to find it was blocked or closed on their return home (I would still be hesitant to log into my PayPal account in certain countries!)

Times are changing though and whilst embracing countries like Russia will force PayPal to review their risk profiles there’s no question that emerging economies offer massive growth to PayPal in the future.

Broadly speaking for main stream Europe there are no fee changes, it’ll cost you slightly less to trade with Northern Europe and slightly more to trade with Eastern Europe.

Cross border fee decreases

If you’re selling to Northern Europe (Denmark, Finland, Norway, Sweden, Iceland etc), you’ll benefit from a lower cross border fees as PayPal pass their own cost savings on – 0.4% of the transaction value compared with 0.5% now.

Cross border fee increases

If you’re selling to Asia, South America or Africa, you’ll see your cross border fee rising from 0.5% to 1.5%. Also the fee for some European countries is rising to 1.0% – this includes countries like Russia, Serbia and Romania. This is simply because it costs PayPal more to transact in the newly added currencies in these countries.

Currency conversion fee increases

Buyers and people sending money abroad will see a small increase in currency conversion fees. For example, the fee for sending a payment in euro from a UK (sterling) account will increase from 2.5% to 3.5% above the wholesale exchange rate applied to the amount being sent. The fee for sending a payment in US dollars will be 3% above the wholesale exchange rate.

20p charge for refunding a customer

For the first time, PayPal will be retaining the fixed (20p) portion of the transaction fee where a seller has made a full refund. There will be no changes in PayPal fees for partial refunds.

I can’t see many sellers liking this new cost, but in comparison many other payment providers retain the whole fee.

Doubling the chargeback fee

PayPal does not apply a chargeback fee if the transaction is covered by PayPal Seller Protection Programme. This is not changing, but the fee in all other cases is increasing from £7 to £14. This reflects the costs PayPal incurs in handling disputes.

I’m not to worried about this one personally as I’ve always been covered by PayPal Seller Protection for eBay transactions. However if you use PayPal off eBay then only transactions between UK, US or Canadian buyers and sellers can be covered by PayPal Seller Protection and this could have more impact.

Why the fee changes?

Since 2003 PayPal have invested heavily in expanding their services – for example, adding 40 new transactional currencies. In the main these changes are an adjustment of the cross border fee by region and country to reflect more closely the costs PayPal incur.

Unlike eBay who opted for a simpler fee structure to make it easy for sellers to calculate their costs (which for most people was a sizeable fee hike), PayPal have chosen a more complicated fee structure but one that relects the real cost of the transaction and currency conversion. I guess that means PayPal think sellers are more intelligent than eBay and prefer to do the maths and save money where they can.

Fee increases are never going to be popular, especially for those sellers who transact in the countries which will now be more expensive to trade with. In reality though PayPal is of course convenient and still competitively priced compared to merchant banking arrangements.

At the end of the day if we sell on eBay we don’t have a choice but to use PayPal, so we’ll complain about the fees and then pay them, and in truth by the time they come into effect we’ll probably not even notice the difference.

Just a week after announcing the acquisition of Zong giving PayPal access to over 250 mobile carrier around the world they’ve demonstrated their first NFC (Near Field Communications) solution for Android handsets.

Money can now be transferred by typing a request to send or receive money into a widget and then simply holding phones together until a buzz indicates the request has been transmitted. Then it’s just a case of entering your PayPal password or PIN to complete the money transfer.

Currently the only Android phones to with an NFC chip built in is the Nexus S. That kind of limits the market for PayPal when they launch the widget later this year. However it’s expected that many future Android phones will have NFC chips built in and soon it won’t be just sending money to your friends by touching mobile phones – you’ll be using your NFC capable mobile phone to pay with PayPal wherever you see the PayPass symbol available.

Think Facebook credits for Farmville upgrades and you’ll get the idea of where Zong fits in the market. To make a purchase just enter your mobile phone number onscreen and you’ll receive a text with a one time confirmation PIN code. Confirming your purchase with the PIN and wait for your phone bill to arrive, although with Zong+ you can link your credit or debit card to your mobile phone number and get double your purchase.

You may wonder why PayPal would want to buy this mobile text/billing company and where the interest in social network gaming credits lies. Also if PayPal have an interest in this market don’t they have the expertise to build their own solution? The truth is that all PayPal are really interested in, and the reason they’re coughing up $240 million for Zong is who they know.

Zong have connections with more than 250 mobile carriers in 45 countries and that’s what PayPal want. Zong have done the legwork and with the acquisition PayPal will be well placed to exploit the mobile payments market and take advantage of the billing relationships already set up by Zong.

Click to embiggen

As all my recent sales have been on eBay it appears that PayPal are picking up the despatch status from eBay, but this could be a useful feature for checking at a glance that eBay haven’t missed marking any orders as paid – if the payment shows in PayPal and you haven’t shipped the item then it’s worth investigating why it’s not been posted.