posted: Apr. 21, 2003 @ 1:45p
Over the past 4 years, many different companies have offered methods for sending payments to 3rd parties via the internet. This thread offers a starting place for finding information about those alternatives.
Several websites are devoted to discussing pros and cons of various services. The best of these is probably http://www.ccs-digital.com/payments.asp Izzy, who maintains the site, has actively followed the major players for years, and has good contacts with several of them. I make a point to check his updates periodically.
A dated (10/00-3/01) but still interesting FW finance thread on different payment services is at http://www.fatwallet.com/forums/forum.php?catid=18&threadid=9499
Major Credit-card and Bank-account based payment services
Several payment services allow you to send payments via your credit card or bank account. By far the largest of the payment services is paypal.com, which was recently purchased by eBay.com. There are several sites devoted to this payment service in particular. Again, I recommend Izzy's site, this time at http://www.ccs-digital.com/paypal.asp. Some have criticized his work as being too critical of paypal, and of course there are many different perspectives on much that he's reported, but but I find him to be a useful watchdog. He also links to a number of threads where both detractors and defenders of paypal offer useful points.
Other sites that are critical of paypal include http://www.paypalsucks.com/.
UPDATE 10/03: c2it has discontinued their service.
c2it.com has been another popular service, run by Citibank. Their site has been plagued with bugs since it went live. Recently, they began charging buyers 2% fees on each transaction, which will cut down dramatically on the service's popularity. Moreover, some credit card companies have been charging cash advance fees for sending money via c2it. See http://fatwallet.com/forums/forum.php?catid=52&threadid=57801 for a thread discussing this. In addition, one can no longer fund one's c2it account with a credit card as of 2/23/03, removing a popular stratagem whereby users would get card rewards by loading cash from their credit card into their account.
Now that ebay's billpoint has been discontinued, all other services run very far back in the pack. I will add links as new providers come on line, or new questions about older services warrant answering here.
Bank-account based payment services
These providers get less attention, but that may change as more people become wary of problems with credit-card based services and the fees, charge backs, etc. that can accompany them.
Checkfree, the people who handle much of the online bill payment business, have offered several programs. The latest version is at http://ugotmoney.com (thanks DWJoe). It seems that this latest program aims to restrict payments to participating banks and credit unions, listed on the site. Their basic program restricts free payments to 3 each month, 50 cents each after that. Please post with updates on this service.
An earlier version of their service was my favorite service through this spring: validcash.com. Unfortunately, that service was revised to focus on auction payments, and Checkfree added a fee structure for all payments, making them an inferior alternative. I don't have experience with their new product, but would be glad to include others' experiences. A separate thread is devoted to it at
A new entry to this field is the US Postal service. Details on their program are at http://usps.com/paymentservices/pspaymnt.htm (thanks ChaChing.) Unfortunately, FAQ is focused on their bill pay service, so it isn't easy to figure out things like daily limits as of yet. Please post if you have experiences with this payment method.
For a while, Achex.com was the leader in this segment. Then, they stopped doing this: per their web site, "As of February 1, 2002, the ability to send and request email payments was suspended."
Hybrid and other interesting services
A few payment services have taken unique approaches to sending and receiving money. Not surprisingly, some have been better thought out than others. Among the strange was "egold", a payment service that allowed the exchange of gold bullion! On the other hand, some have offered interestingly different products that warrant mention here.
One of these is Ecount, located at https://www.ecount.com/defaultecount.asp. They offer a debit card/email payment hybrid. You can add $500 a day ($1000 a month) and withdraw $1000 a day. Here is their fee structure (from a popup window):
Sign Up Free!
Shop Anywhere Free!
Send $ via email Free!
Receive $ via email Free!
Request $ via email Free!
Add $ via credit card 2.00 per transaction
Withdraw $ via check 2.95 per transaction
Withdraw $ via ATM $1.00 per transaction
Get the ecount Card $6.95 one time fee
NOTE: Buried in the fine print of the FAQ is an option to do a direct deposit WITH NO FEE to the ecount, as well as an ACH withdrawal, ALSO WITH NO FEE. Very nice! For the deposit, log in, go to "add money," then select the "direct deposit" option, then print out the form, which will give you your account number and ACH routing number. For the withdrawal, call customer service and ask for an ACH withdrawal form. You have to mail it in to them, but then you can withdraw up to $9,999 for one $2 fee.
They also seem to have very good customer service. This morning, I called to update my primary email address (I haven't used them in 3 years or so.) They picked up on the first ring, and promptly solved my problem. With the demise of Webcertificate and other temporary debit card options, this alternative bears watching--if only because they are _different._
Please feel free to ask for clarifications or suggest additions. <img src="i/expressions/face-icon-small-smile.gif"border=0>
(Updated 10/03 to reflect Checkfree's latest program and the demise of c2it.)