eBay to replace PayPal as its main payments provider

eBay has signed an agreement with Adyen, a leading global payments processor, to become its primary payments processing partner. Additionally, eBay and PayPal have aligned on terms to offer PayPal as a way to pay at checkout on the eBay intermediated model until July 2023. PayPal will remain an important partner to eBay.

eBay intends to further improve its customer experience by intermediating payments on its Marketplace platform.  In doing so, eBay will manage the payments flow, simplifying the end-to-end experience for buyers and sellers. eBay has signed an agreement with Adyen, a leading global payments processor, to become its primary payments processing partner.

„PayPal, a long-time eBay partner, will be a payments option at checkout for eBay buyers.  The transition to full payments intermediation will be a multi-year journey, and eBay will move as quickly as possible to complete this process within the parameters of the Operating Agreement with PayPal, which remains in place through mid-2020.”, according to the press release.

As a leading global commerce company, eBay believes that payments intermediation is strategically important to improve the buyer and seller experience on its platform and will enable the company to further innovate on behalf of its customers. In a rapidly changing and competitive ecommerce landscape, shoppers expect to be able to both shop and checkout on the site on which they transact.

As eBay intermediates payments, shoppers will be able to complete their purchases within eBay.

Timing

eBay will begin payments intermediation on the Marketplace platform on a small scale in North America starting in the second half of 2018, expanding in 2019 under the terms of the Operating Agreement with PayPal. In 2021, eBay expects to have transitioned a majority of its Marketplace customers to its new payments experience.

The way that sellers engage with eBay in an intermediated landscape will, for the most part, be very similar as they do today.  For example, sellers will not need to change their accounts with eBay. Sellers will continue to log into eBay and manage their listings as they do today.  As eBay begins to intermediate payments, sellers can expect to see new, streamlined dashboards and reports inclusive of payments – all within eBay.

To enable payments in their eBay accounts, sellers should expect to provide eBay with some additional payments-related data and transition to a new relationship with eBay that includes integrated payments capabilities.

Sellers will be required to complete these steps in order to continue selling on eBay, and it is anticipated that this transition for sellers will occur no later than one year after the expiration of eBay’s Operating Agreement with PayPal, i.e., by July 2021.