Sorry Pakistan (Why PayPal Stinks)
I use PayPal to accept payment for all BMOW products. Customers can create a PayPal account and send money from their account balance, or they can use PayPal with a Visa credit card to send payment directly without creating an account. That’s mostly worked OK, but today I learned that PayPal straight-up denies all credit cards from Pakistan, no exceptions. It’s like a giant middle finger, extended to an entire country of 182 million people. In fact there are 18 countries where PayPal won’t accept payments, some of which would probably never be customers of mine anyway (Papua New Guinea?), but with over 100 million people and English as an official language, the absence of Pakistan is especially galling.
PayPal is popular, at least in the United States, and it’s convenient, but it can also be infuriating. They act like a bank, and hold balances and perform money transfers like a bank, but aren’t subject to the same regulations as a bank. The internet is full of horror stories where PayPal froze accounts containing thousands of dollars due to “suspicious activity”, with no path or process for people to appeal or even discuss it with a human being. And from a seller’s point of view, the PayPal dispute resolution process is as bad as it gets. If you want to scam me, just buy a Floppy Emu, and when it arrives file a PayPal dispute saying that the item was not as described. You will get your money refunded 100% of the time and end up with free hardware, and there’s nothing I can do about it. (Please don’t actually do this.)
Unfortunately there are no realistic alternatives to PayPal that provide similar capabilities. WePay is US-only. Square is only slowly expanding outside the US. Amazon Payments is a mess. Too many companies seem to believe the world consists of the United States and “miscellaneous other”, a group of 6.7 billion people who are somehow not very important.
After some investigation, it looks like the best solution for a one-time payment from Pakistan to the United States is a money transfer service like Western Union or MoneyGram, even though they charge a 10% commission. It’s OK for a one-off, but if I were receiving a lot of orders from Pakistan, it would be a poor long-term solution. If anyone has experience with sending money from Pakistan to the USA and can suggest a better method, I’d be happy to hear about it.
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I’ve heard nothing but good things about Stripe, https://stripe.com. Checking their website, they definitely support payments from Pakistan (one of the supported currencies is the Pakistani Rupee).
Everybody raves about their API, though unlike PayPal they unfortunately don’t provide shopping cart functionality (their service is designed to be integrated with your own shopping cart)
Bitcoin? Not ever having used it I have no idea what the pitfalls might be…
If nothing else, the continuously and widely fluctuating value of Bitcoin would make it a dodgy choice to run a business on, I’d have thought.
Bitcoin is not as dodgy as you might think. Business that accept it use services like https://bitpay.com/ where the money gets turned back into whatever currency you want.
Just to followup, Newegg and Microsoft both accept Bitcoin through BitPay. Check them out!
Bitcoin is the solution for the situation described in this article. With bitcoin there is no chargeback, no frozen accounts, no 10% fee, and no middle fingers to countries.
The pitfalls are: (1) you must take care to secure your bitcoins and (2) you must be able to convert it to your local currency or else buy the things you need with it directly. If you want (2) easily, use Bitpay or Coinbase.
I wonder how easy it is for a Pakistani to buy bitcoins?
Has anyone tried getting a USA PayPal account from Auction Essistance?