Alibaba: Payment methods on AliExpress
Earlier this month PayPal decided they’d cut ties with Alibaba’s AliExpress platform and would cease to process payments to merchants from the 3rd of August this year.
We asked AliExpress their thoughts on PayPal’s decision to part company with them, and whilst they were diplomatic in not slating PayPal (which I have to admit under the circumstances I might not have been so restrained), but they did tell us:
AliExpress is committed to serving our customers with choice in payment options. Currently, AliExpress accepts payments made using Visa and Mastercard credit cards, the Moneybookers online payment system, bank transfers and certain bank debit cards. As always, our primary focus is our customer’s needs, and we will continue to offer multiple, secure payment options on AliExpress for our customers around the world. We are always exploring ways to make payment easier for our customers
It’s worth remembering that AliExpress is a pretty safe platform to purchase on. Not only do you have the standard protection that your payment provide gives, but AliExpress hold all payments in Escrow until the buyer confirms they’ve received the goods and they’re as expected. Until the buyer confirms receipt the seller doesn’t receive the funds.
I still think this is the wrong decision for PayPal. I know that AliExpress, although intended for trade purchases, is used by many consumers. At the end of the day though whether it’s consumer or businesses surely transaction payment volume is what PayPal is all about so why cut off an entire marketplace?
“surely transaction payment volume is what PayPal is all about so why cut off an entire marketplace?”
Could it be because Paypal reported to eBay that Paypal transaction volume had reached a certain level at AliExpress and therefore the eBay panic button was pushed?
Ask yourself why Amazon do not use Paypal?
There should be Chinese walls between eBay and Paypal and it is a real regulatory issue if there is not.
Of course it may have been a decision entirely made by Paypal alone. How likely is this?
Trust can take a lifetime to build but a moment to loose.
Whilst I trust my bank do I trust Paypal?
Or eBay for that matter?
That is a real issue and a test of character for both eBay and Paypal. I may have a working arrangement with Paypal and eBay and it is a marriage of convenience. But do I trust either?
I honestly wish I could but eBay and Paypal let themselves down in this regard on so many things.
AliExpress may well in the medium to long term be a lot better off as a result of the Paypal divorce and I wish them well.
I wonder if it had anything to do with the comparatively high number of fraudulent vendors on Alibaba that prompted or contributed to this decision.
Having bought products twice from Chinese sources via Alibaba, I am extremely reluctant to do so again…
What it’s very easy to forget is that Aliexpress doesn’t need paypal, it already has its own payment processing option(Alipay) which is used in the majority of transactions by Taobao and that at some point I’m sure they would want to make this solution available internationally and promote it fully. At the moment Paypal adds a certain ‘brand/security’ but this is something that the company wouldn’t have kept forever, if you have your own payment processor why would you want to use another company to do this?
This is what Alipay say:-
“As of December 2010, Alipay had more than 550 million registered users and facilitated around 8.5 million transactions daily. Alipay is an affiliate of Alibaba Group.”
Now thats more than twice as many registered users as Paypal!
While accepting the numbers. What about the Geographic spread? My guess is that the vast majority of Alipay Accounts would be in China and the Far East with relatively few in Europe and the Americas. Might I suggest that this fact may be one of the main reasons why Aliexpress might well have liked to retain Paypal as a payment option.