Monday 19th November 2018

PayPal’s and eBay’s separation is about to get acrimonious

by on 1st February 2018

The two have long been treated synonymously by consumers, however following their split in 2015, eBay has just announced it will simplify “the end-to-end experience” for buyers and sellers by partnering with Adyen, a Dutch payment processing company.

eBay has stated Adyen will become its “primary payments processing partner” however PayPal will remain an option for buyers during checkout – eBay is roughly 13% of PayPal’s business and the news prompted a 10% drop in PayPal’s share price.

eBay, in a blog post published on its corporate website, determined that the new integration will drive more innovation and fulfill a consumer demand to transact and shop on the same website.

They also stipulated that the new integration will lead to a host of benefits for buyers and sellers, including:

  • Sellers will benefit from a more transparent pricing structure, reduced payment processing costs and higher conversion rates. eBay has also stated the new partnership will facilitate opportunities for sellers to expand into new markets
  • Buyers will benefit from more payment options at checkout and a more integrated experience

eBay also claims that Adyen’s payment processing solutions extend to 150 currencies and 200 methods of payment.

They have also stated that their existing operating agreement with PayPal remains in place through to 2020, and that PayPal and eBay have “aligned on terms” to continue to offer PayPal as a checkout option through to 2023.

The rollout of the new payments solution will begin on a small scale in North America in 2018 and eBay states it expects the majority of its customers to have transitioned to the new payments solution by 2021.

In order to facilitate this new solution, eBay has asserted that sellers will need to provide additional data (while they haven’t specified what this is they assert that more information will be forthcoming).

There’s already been reaction to the news in eBay’s community forums, with the most common concern cited being Adyen’s existing integration with Etsy and a 3 day delay in sellers receiving their funds (whereas through PayPal they receive access to their funds instantaneously).