PayPal Automatic Payments Now The Default on All Purchases

UFO on 04/12/2018 - 17:59
Last edited 04/12/2018 - 18:01

Howdy,

I just tried to purchase through a new vendor, and noticed that I was forced to agree to an automatic payments agreement for that vendor.
I didn't like the idea of giving a vendor authorisation for direct debit, so made the purchase with a credit card directly.

I went into Paypal to check previous vendors I haven't shopped with in months, and sure enough I now have AUTOMATIC PAYMENTS enabled for all of them!
They all have authorisation to debit first my credit card (which has a substantial limit on it), and then my savings account without me pressing a button to say yes.

Yes yes, I can raise a dispute and get my money back… but that's not the point. They can take my money without any interaction from me, and then I have to fight to get it back.

I was just wondering, a) What is Paypal thinking by forcing people to authorise automatic payments?, and b) What is the best card to apply for to use as an 'online purchase only' card?

I've since had to go through and cancel each and every vendor's automatic payment authorisation, and apparently if I want to buy with them again I have to re-enable the prior authorisation (which I have no intention of ever doing).

Bye bye Paypal!!

Thoughts?

Financial

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PayPal
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Marketplace

Comments

  • geek001 on 04/12/2018 - 18:05
    +1

    I don't think this is the default on Paypal purchases. Probably just a coincidence. Paypal has a automatic payment authorization usually for subscriptions, but I think some online shops/telcos implement it that way.

    I usually just logon to my paypal account and cancel the automatic payment authorization. Problem solved. The shop won't know this has happened until the next time they try to debit my account. Hehe.. payback.

    • UFO on 04/12/2018 - 18:08
      +1

      That's the crunch though… ALL previous vendors had automatic payment authorisation setup!

      Go check it out yourself. Myers, Big W, Guzman Gomez, and a stack of other vendors I haven't bought from in ages (some of them years!) and they all had it enabled!

      This hasn't always been the case, and I suspect it was recently implemented quietly with a change of terms and conditions under the guise of convenience.

      • geek001 on 04/12/2018 - 18:16

        Yep, checked. Only has Ebay, KFC and Google on my automatic payment list.

        Shops that I have bought from in recent months are not on the list:
        LITB
        Geekbuying
        Zapals
        AirAsia
        SuperCheapAuto
        Telstra
        Dominos
        Frank Green
        Roblox

        • UFO on 04/12/2018 - 18:56

          Hmmm… see now I'm confused.

          Did you:

          Click on the Settings wheel top right, Payments subtab, then Manage Automatic Payments?

          Automatic payments of course can't be accessed through the front menu, its in a convoluted spot within settings.
          Every vendor I've ever dealt with was enabled.

  • Quantumcat on 04/12/2018 - 18:08
    +1

    Automatic payments are great, you can sign up for free trials and cancel the authorisation so never need to worry about forgetting to cancel. I would hate to have to use a credit card directly for that.

    • UFO on 04/12/2018 - 18:09

      That's fine… IF you agree to it in the first place. Cancelling after agreeing is fine, but forcing every one off purchase you make to now be automatic payment authorisation is very concerning imo.

      • Quantumcat on 04/12/2018 - 18:25

        True

        • resisting the urge on 04/12/2018 - 19:20
          +1

          Not fine/True. It is just one of the incremental steps to establishing ongoing access to your accounts.

          If you agree and then rescind, vendors then just move to remove access the day you cancel their on-demand payment authorisation. They simply check through an automated API call if they are authorised to charge your account.

          PayPal and eBay are going beyond the pail making this a thing for retailers. It was bad enough doing it with subscription providers. It'll just cause a a great deal of consumers pain and confusion. Auto approval for ad-hoc payments are insecure, already being exploited by hackers and dodgy businesses alike, let alone employees who might make mistakes you end up paying for!

          • HighAndDry on 05/12/2018 - 12:05

            @resisting the urge:

            If you agree and then rescind, vendors then just move to remove access the day you cancel their on-demand payment authorisation.

            Unless you prepaid for the entire period, in which case I assume they won't/can't remove access, what's wrong with this?

            • Quantumcat on 05/12/2018 - 16:09

              @HighAndDry: Well, nothing wrong with it from seller's POV, just means free trials won't work (for buyers) unless you remember to remove payment details at the end of the trial (so no better off than having to remember to cancel trial right at the end) I doubt if there is an API call for that though, as I have never seen anyone use it (they just tell you your payment didn't work when they try to charge)

              • HighAndDry on 05/12/2018 - 16:12
                +1

                @Quantumcat: Yeah that's what I thought too - I have reminders set to cancel all my free trial subscriptions anyway (or any other on-going contract that I might want to cancel).

                • resisting the urge on 06/12/2018 - 13:08

                  @HighAndDry: No, they can do this immediately no matter if free or paid, depending only on jurisdiction. Because in addition to the regular auth check, all they need do is add a Term into the User Agreement which allows them to withdraw service if the user withdraws their payment Auth.

                  Instead of being cheaper or better, PP is working on sneakier ways to provide better value to merchants than the incumbents can. That it causes abuse, let alone sells out the trust of their users is just (yet another) failure on their part to weigh up the impact on brand and loyalty, etc. of the most recent thought bubble their marketing group presents. Head hunting social marketers is fraught with danger for a global Fintech.

                  • HighAndDry on 06/12/2018 - 13:15

                    @resisting the urge: I said:

                    Unless you prepaid for the entire period

                    If you've paid for services for a period, they can't magically "withdraw" their services. If they did, you'd just make a claim with paypal for services not provided.

                    And:

                    all they need do is add a Term into the User Agreement which allows them to withdraw service if the user withdraws their payment Auth.

                    They can already add that as a condition to their free trials - if you haven't paid anything, you're not entitled to anything other than what they're willing to gift you.

                    • resisting the urge on 06/12/2018 - 13:26

                      @HighAndDry: They can add it to a freebie conditions, but they do it in their main Ts&Cs in order to catch current subscribers/customers, and to make it a global rule from a known date to simplify support processes (and maximise revenues)

                      If you've paid… not always. IIRC, it depends on what jurisidiction applies, and/or what was/is in the fine print

    • ngengerous on 05/12/2018 - 11:06
      +1

      Be wary of doing this.

      I went through an admittedly dodgy website and signed up with my PayPal, cancelling the auto payments so that my account could not have money taken out of it, but I received a letter in the mail from a debt collector trying to round up a few hundred I apparently owed them in payments which didn't go through. I managed to weasel my way out of it, but be aware that some sites include a clause in their T&Cs that entitles them to go after you for any payments which don't go through.

  • Strahany on 04/12/2018 - 18:15
    +2

    This stung me with a PayPal payment associated with using the SiNEMiA movie service (which I detailed in the appropriate thread). When I called PayPal, they told me “it’s not PayPal's problem” since there was no way a payment agreement is set up without approval, despite that being exactly what happened (in this case, Village Cinemas).

    I believe they’re doing it to cover themselves from being left out of pocket in the event of any issues.

    • UFO on 04/12/2018 - 18:50

      That's the impression I get too.
      A shame, because up till now PayPal has been great. This is just a shameless pass the buck exercise.

  • garetz on 04/12/2018 - 18:26
    +1

    Its basically a screw you, not my problem, its your problem situation where paypal created plausable deniability for themselves.

  • taoz on 04/12/2018 - 21:47

    interesting why some of these now are active.
    hopefully someone will know why or it will stop

  • [Deactivated] on 05/12/2018 - 00:21

    3 out of eight were active, for unknown reasons.
    This seems criminal to me 'Paypal'.
    We should make the decisions over our own spending.

  • Love a bargain on 05/12/2018 - 12:47

    None active (phew)

  • Traveller107 on 05/12/2018 - 14:02

    Thanks for the heads up OP I will check mine. Cheers!

  • Rifraf on 05/12/2018 - 14:45

    Is what we are talking about "My pre-approved payments-PayPal"?

    I see "iTunes and Ap Store"

    Am I likely to be looking in the right place?

    • Quantumcat on 05/12/2018 - 16:11
      +1

      Yes that sounds right

      • Rifraf on 05/12/2018 - 18:11

        Thank you.

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