We use primarily use Paypal for our smaller transactions at Foliovision ($1000 and under). Some customers complain. They’d just rather not do business with Paypal. In these cases, we do have bank accounts in three major jurisdictions but it does slow down transactions and increase transaction costs on smaller invoices.
I tell them there is just no other payment service which works well for small international payments.
Precautions we take:
- we don’t confirm our bank account numbers which technically means that Paypal can’t withdraw funds from our bank accounts.
- they do do it anyway, but in our case it would be illegal and there’s a very good chance that the bank would go after Paypal for the money themselves if Paypal did manage to snooker them into giving them cash.
- we run a balance under $2000. Over that and the money gets shunted off to one of our bank accounts.
- we are very good customers. We send lots of sales through and we buy lots of goods too. Occasionally we even have to switch currencies. Paypal makes a fortune off of Foliovision. We even introduce lots of new customers to them as well.
In general, limit liability and make yourself valuable. I recommend you do the same.
But then I go and read a post like this one about how Paypal single-handedly nearly ruined the Macgraphoto graphics bundle (sorry to have missed it Jacob: great idea for a themed bundle!). And I think we haven’t done nearly enough and that we are playing with fire.