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PayPal Inc.
Type Subsidiary of eBay
Founded Palo Alto, California USA (1998)
Headquarters Flag of the United States San Jose, California USA
Parent eBay
Website www.paypal.com
Advertising none
Available in US English
Spanish
French
Chinese
Current status active
eBay's North First Street satellite office campus (home to PayPal's corporate headquarters)
eBay's North First Street satellite office campus (home to PayPal's corporate headquarters)

PayPal is an e-commerce business allowing payments and money transfers to be made through the Internet. eBay Inc is an American Internet company that manages eBaycom an Online auction and shopping Website in which people and businesses buy and Palo Alto (ˌpæloʊˈæltoʊ from Spanish: palo: "stick" and alto: "high" i The United States of America —commonly referred to as the Year 1998 ( MCMXCVIII) was a Common year starting on Thursday (link will display full 1998 Gregorian calendar) The United States of America —commonly referred to as the A holding company is a company that owns part all or a majority of other companies' outstanding Stock. eBay Inc is an American Internet company that manages eBaycom an Online auction and shopping Website in which people and businesses buy and A website (alternatively web site or Web site, a back-construction from the Proper noun World Wide Web) is a collection of Web pages Online advertising is a form of Advertising that uses the Internet and World Wide Web in order to deliver Marketing messages and attract customers A human language is a Language primarily intended for communication among Humans The two major categories of human languages are Natural languages and Phonology North American English regional phonology In many ways compared to English English, North American English is conservative in its Phonology. French ( français,) is a Romance language spoken around the world by 118 million people as a native language and by about 180 to 260 million people Electronic commerce, commonly known as e-commerce' or eCommerce, consists of the buying and selling of products or services over electronic Money is anything that is generally accepted as Payment for Goods and services and repayment of Debts. The Internet is a global system of interconnected Computer networks It is also a European bank based in Luxembourg. Luxembourg (Groussherzogtum Lëtzebuerg Grand-Duché de Luxembourg Großherzogtum Luxemburg is a small Landlocked country in Western Europe, bordered by It serves as an electronic alternative to traditional paper methods such as cheques and money orders. A cheque (spelled check in American English) is a Negotiable instrument instructing a Financial institution to pay a specific amount of A money order is a Payment order for a pre-specified amount of Money. PayPal performs payment processing for online vendors, auction sites, and other corporate users, for which it charges a fee. "Auctioneer" redirects here For the DC Comics supervillain see Auctioneer (comics. A corporation is a separate legal entity usually used to conduct business It sometimes also charges a transaction fee for receiving money (a percentage of the amount sent plus an additional fixed amount). The fees charged depend on the currency used, the payment option used, the country of the sender, the country of the recipient, the amount sent and the recipient's account type. On October 3, 2002, PayPal became a wholly owned subsidiary of eBay. Events 42 BC - First Battle of Philippi: Triumvirs Mark Antony and Octavian fight an indecisive battle with Caesar's See also 2002 (disambiguation Year 2002 ( MMII) was a Common year starting on Tuesday of the Gregorian calendar. A subsidiary, in business matters is an entity that is controlled by a bigger and more powerful entity eBay Inc is an American Internet company that manages eBaycom an Online auction and shopping Website in which people and businesses buy and [1] Its corporate headquarters are in San Jose, California, United States at eBay's North First Street satellite office campus. California ( is a US state on the West Coast of the United States, along the Pacific Ocean. The United States of America —commonly referred to as the The company also has significant operations in Omaha, Nebraska, Scottsdale, Arizona and Austin, Texas in the U.S.; India, Dublin, Ireland; and Berlin, Germany. Scottsdale ( O'odham Vaṣai S-vaṣonĭ; Yaqui Eskatel) is a city in the eastern part of Maricopa County, Arizona, The United States of America —commonly referred to as the India, officially the Republic of India (भारत गणराज्य inc-Latn Bhārat Gaṇarājya; see also other Indian languages) is a country Dublin (ˈdʌblɨn/ /ˈdʊblɨn or /ˈdʊbəlɪn/, bˠalʲə aːha klʲiəh or cliə(ɸ is both the largest city and capital of Ireland. Ireland ( Irish: Éire, ˈeːrʲə is a country in north-western Europe. Berlin is the capital city and one of sixteen states of Germany. Germany, officially the Federal Republic of Germany ( ˈbʊndəsʁepuˌbliːk ˈdɔʏtʃlant is a Country in Central Europe. [2]

Contents

History

Beginnings

The current incarnation of PayPal is the result of a March 2000 merger between Confinity and X.com. Confinity Inc is best known as the creator of PayPal. It was founded in December 1998 by Max Levchin, Peter Thiel, and Luke Nosek, initially PayPal is an E-commerce business allowing payments and Money transfers to be made through the Internet. [3] Confinity was founded in December 1998 by Max Levchin, Peter Thiel, and Luke Nosek, initially as a Palm Pilot payments and cryptography company. Max Levchin (born 1975 is a Ukrainian -born American Computer scientist and Entrepreneur widely known as co-founder (with Peter Thiel Peter Andreas Thiel (born 1967) is an American Entrepreneur, Hedge fund manager and venture capitalist Luke Nosek is an American Entrepreneur. In 1998 with Max Levchin, Peter Thiel, and Ken Howery, Nosek co-founded PayPal This is a new page about the Second Generation of Palm PDAs For the generic page see Palm (PDA The PalmPilot Personal and PalmPilot Professional [4] X. com was founded by Elon Musk in March 1999, initially as an Internet financial services company. Elon Musk (born 28 June 1971) is an Entrepreneur and a co-founder of PayPal and SpaceX. Both Confinity and X. com launched their websites in late 1999. Both companies were located on University Avenue in Palo Alto. Confinity's website was initially focused on reconciling beamed payments from Palm Pilots [5] with email payments as a feature and X. com's website initially included financial services with email payments as a feature.

At Confinity, many of the initial recruits were alumni of The Stanford Review, also founded by Peter Thiel, and most early engineers hailed from the University of Illinois at Urbana-Champaign, recruited by Max Levchin. The Stanford Review is a conservative student-run newspaper that serves Stanford University in Stanford California. This article is about the flagship campus For other uses and locations of University of Illinois, see University of Illinois (disambiguation The University of On the X. com side, Elon Musk recruited a wide range of technical and business personnel, including many that were critical to the combined company's success, such as Amy Klement, Sal Giambanco, Roelof Botha[6] of Sequoia Capital, Sanjay Bhargava and Jeremy Stoppelman. Roelof Botha is a Venture capitalist. He began his career as an Actuary. Sequoia Capital is a Venture capital firm founded by Don Valentine in 1972 [7]

To block potentially fraudulent access by automated systems, PayPal devised a system (see CAPTCHA) of making the user enter numbers from a blurry picture, which they coined the Gausebeck-Levchin test. A CAPTCHA (ˈkæptʃə is a type of challenge-response test used in Computing to ensure that the response is not generated by a computer According to Eric M. Jackson, author of the book The PayPal Wars, PayPal invented this system now in common use; however, there is evidence AltaVista used a CAPTCHA as early as 1997, before PayPal existed. Eric M Jackson is the president of World Ahead Publishing and a former vice president of marketing at PayPal. The PayPal Wars Battles with eBay the Media the Mafia and the Rest of Planet Earth (ISBN 0-9746701-0-3 is a book by former PayPal marketing executive Eric The neutrality of The PayPal Wars, which was self-published by Eric Jackson through his company World Ahead Publishing, funded in part by Peter Thiel, is disputed.

eBay watched the rise in volume of online payments and realized its fit with online auctions. eBay purchased Billpoint in May 1999, prior to the existence of PayPal. Billpoint was the name of a person-to-person money transfer service purchased by online auctioneer EBay in 1998 eBay made Billpoint its official payment system, dubbing it "eBay Payments," but cut the functionality of Billpoint by narrowing it to only payments made for eBay auctions.

For this reason, PayPal was listed in several times as many auctions as Billpoint. In February of 2000, the Paypal service had an average of approximately 200,000 daily auctions while Billpoint (in beta) had only 4,000 auctions. By April of 2000, more than 1,000,000 auctions promoted the PayPal service. PayPal was able to turn the corner and become the first dot-com to IPO after the September 11 attacks. Initial public offering (IPO, also referred to simply as a "public offering" is when a company issues Common stock or shares to the public for the first

Acquisition by eBay

In October 2002, PayPal was acquired by eBay for $1. 5 billion. [8] PayPal had previously been the payment method of choice by more than fifty percent of eBay users, and the service competed with eBay’s subsidiary [[BillpointCitibank’s c2it service closed in late 2003, and Yahoo!'s PayDirect service closed in late 2004. Citibank is a major international Bank, founded in 1812 as the City Bank of New York, later First National City Bank of New York. Yahoo! PayDirect was the name of a person-to-person money transfer service by Yahoo! via HSBC, competing with Billpoint and PayPal. Western Union announced the December 2005 shut down their BidPay service but subsequently sold it in 2006 to CyberSource Corporation. BidPay was an online auction payment service web site established in 1999 by Steve Chin and Marek Bradbury that originally allowed auction buyers to purchase CyberSource is a provider of electronic payment and Risk management solutions BidPay announced it will cease all operations on December 31st, 2007. Some competitors which offer some of PayPal’s services, such as Wirecard, Moneybookers, 2Checkout, CCNow and Kagi, remain in business, despite the fact that eBay now requires everyone on its Australian and United Kingdom sites to offer PayPal. Wirecard AG is a global financial services and technology company headquartered in Germany Moneybookers is an E-commerce business that allows payments and Money transfers to be made through the Internet. For a topic outline on this subject see List of basic Australia topics. The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom, the UK or Britain,is a Sovereign state located [9][10]

PayPal’s total payment volume, the total value of transactions, was US$11 billion in the fourth quarter of 2006, an increase of 36% over the previous year. The United States dollar ( sign: $; code: USD) is the unit of Currency of the United States; it has also been The company continues to focus on international growth and growth of its Merchant Services division, providing online payments for retailers off eBay.

Business today

Currently, PayPal operates in 190 markets, and it manages over 164 million accounts. PayPal allows customers to send, receive, and hold funds in 19 currencies worldwide. These currencies are the U.S. dollar, Canadian dollar, Australian dollar, Euro, Pound sterling, Japanese yen, Chinese renminbi, Czech Koruna, Danish krone, Hong Kong dollar, Hungarian forint, Israeli new sheqel, Mexican pesos, New Zealand dollar, Norwegian krone, Polish zloty, Singapore dollar, Swedish krona, and Swiss franc. The United States dollar ( sign: $; code: USD) is the unit of Currency of the United States; it has also been The Australian dollar ( sign: $; code: AUD) is the Currency of the Commonwealth of Australia, including Christmas Please update other articles as well to avoid contradiction within Wikipedia e The Pound Sterling ( symbol £; ISO code: GBP) subdivided into 100 pence (singular penny) is the Currency The krone ( sign: kr; code: DKK) is the Currency of Denmark, including the autonomous provinces of Greenland The forint ( Currency code HUF) is the Currency of Hungary. It is divided into 100 Fillér, although fillér coins have not been The Israeli New Sheqel ( ( sign: ₪; code: ILS) (also spelled unofficially shekel; pl The peso ( sign: $; code: MXN) is the currency of Mexico. The symbol used for the peso is " $ " basically The New Zealand dollar ( sign: $; code: NZD) is the Currency of New Zealand. The krone ( sign: kr; code: NOK) is the Currency of Norway. The plural form is kroner. The złoty (/ˈzwɔtɨ/, plural for numbers ending in 2 3 and 4 (except 12 13 and 14 złote /ˈzwɔtɛ/ plural for all other numbers złotych /ˈzwɔtɨx/ The dollar ( sign: $; code: SGD) is the Currency of Singapore. The franc ( German: Franken, French and Romansh: franc, Italian: franco; code: CHF PayPal operates locally in 13 countries.

Residents in 190 markets can use PayPal in their local markets to send money online. These new markets include Peru, Indonesia, the Philippines, Croatia, Fiji, Vietnam and Jordan. Peru (Perú Piruw Piruw officially the Republic of Peru ( reˈpuβlika del peˈɾu is a country in western South America. The Republic of Indonesia ( (Republik Indonesia is a Country in Southeast Asia. The Philippines ( Filipino: Pilipinas, officially known as the Republic of the Philippines (fil ''Republika ng Pilipinas'' RP Croatia (Hrvatska ˈxȓvatska officially the Republic of Croatia ( Republika Hrvatska) is a southern Central European country at the crossroads between Fiji (Matanitu ko Viti फ़िजी officially the Republic of the Fiji Islands (Matanitu Tu-Vaka-i-koya ko Viti फ़िजी द्वीप समूह गणराज्य Vietnam (ˌviːɛtˈnɑːm Việt Nam) officially Jordan, officially the Hashemite Kingdom of Jordan (الأردنّ al-Urdunn) is an Arab country in Southwest Asia spanning the southern A complete list can be viewed at PayPal's website.

In China PayPal offers two kinds of accounts:

It is impossible to send money between PayPal. cn accounts and PayPal. com accounts, so PayPal. cn accounts are effectively unable to make international payments. For PayPal. cn, the only supported currency is the renminbi.

Although PayPal's corporate headquarters are located in San Jose, PayPal’s operations center is located near Omaha, Nebraska, where the company employs more than 2,000 people as of 2007. [11] PayPal’s international headquarters is located in Dublin, Ireland. Dublin (ˈdʌblɨn/ /ˈdʊblɨn or /ˈdʊbəlɪn/, bˠalʲə aːha klʲiəh or cliə(ɸ is both the largest city and capital of Ireland. The company also recently opened a technology center in Scottsdale, Arizona. Scottsdale ( O'odham Vaṣai S-vaṣonĭ; Yaqui Eskatel) is a city in the eastern part of Maricopa County, Arizona,

PayPal's headquarters in San Jose were hit by a small bomb on the evening of Halloween 2006 which shattered a window but caused no injuries. Halloween, or Hallowe’en, is a Holiday celebrated on the night of October 31. [12]

Online

The domain paypal. com attracted at least 260 million visitors annually by 2008 according to a Compete.com study. Competecom is a United States Web traffic analysis service that publishes the approximate number of U [13]

Bank status

In the United States, PayPal is licensed as a money transmitter on a state-by-state basis. The United States of America —commonly referred to as the [14] PayPal is not classified as a bank in the United States, though the company is subject to some of the rules and regulations governing the financial industry including Regulation E consumer protections and the USA PATRIOT Act. A banker or bank is a Financial institution whose primary activity is to act as a payment agent for customers and to borrow and lend money The USA PATRIOT Act, commonly known as the Patriot Act, is a controversial Act of Congress that U On May 15, 2007, PayPal announced that it would move its European operations from the UK to Luxembourg, commencing July 2, 2007 as PayPal (Europe) S. Events 1252 - Pope Innocent IV issues the Papal bull Ad exstirpanda, which authorizes but also limits the Year 2007 ( MMVII) was a Common year starting on Monday of the Gregorian calendar in the 21st century. Luxembourg (Groussherzogtum Lëtzebuerg Grand-Duché de Luxembourg Großherzogtum Luxemburg is a small Landlocked country in Western Europe, bordered by Events 310 - Pope Miltiades is elected 626 - In fear of assassination Li Shimin ambushes and kills his rival Year 2007 ( MMVII) was a Common year starting on Monday of the Gregorian calendar in the 21st century. à r. l. & Cie, S. C. A. [15] This would be as a Luxembourg entity regulated as a bank by the Commission de Surveillance du Secteur Financier (CSSF), the Luxembourg equivalent of the FSA. The Financial Services Authority ( "FSA") is an independent non-governmental body Quasi-judicial body and a company limited by guarantee that regulates [16] PayPal Luxembourg will then provide the PayPal service throughout the European Union (EU). The European Union ( EU) is a political and economic union of twenty-seven member states, located primarily in

Safety and protection policies

The PayPal Buyer Protection Policy states that customers may file a buyer complaint within 45 days if they did not receive an item or if the item they purchased was significantly not as described. If the buyer used a credit card, they might get a refund via chargeback from their credit card company. A chargeback is a reversal of a payment card transaction initiated by the consumer who holds the card or the bank that issued the card used in the purchase

According to PayPal, it protects sellers in a limited fashion via the Seller Protection Policy. [17] In general the Seller Protection Policy is intended to protect the seller from certain kinds of chargebacks or complaints if seller meets certain conditions including proof of delivery to the buyer. PayPal states the Seller Protection Policy is "designed to protect sellers against claims by buyers of unauthorized payments and against claims of non-receipt of any merchandise". Note that this contrasts with the consumer protection they claim to offer. This policy should be read carefully before assuming protection. In particular the Seller Protection Policy includes a list of "Exclusions" which itself includes "Intangible goods", "Claims for receipt of goods 'not as described'" and "Total reversals over the annual limit". There are also other restrictions in terms of the sale itself, the payment method and the destination country the item is shipped to (simply having a tracking mechanism is not sufficient to guarantee the Seller Protection Policy is in effect). [18]

Security

A PayPal security key generates a six-digit temporary login code to authenticate the user.
A PayPal security key generates a six-digit temporary login code to authenticate the user.

Security key

In early 2007, PayPal introduced an optional security key that adds an additional layer of protection when logging into PayPal or eBay accounts. A security token (or sometimes a hardware token, hard token, authentication token, cryptographic token, or key fob) may be a physical A user account tied to a security key has a modified login process; once the user enters their normal login ID and password, they are prompted to press a button on the security key, then enter the six-digit number generated by the key to complete the login process. This two-factor authentication prevents an account from being compromised by a malicious third party without access to the physical security key. An Authentication factor is a piece of Information and Process used to authenticate or verify a person's Identity or other entity requesting access If a user loses their security key, they can authenticate by providing their credit card or bank account number listed on their account.

There is a one-time US$5. 00 charge to receive a security key, with no ongoing fees; however, business accounts get them free of charge. [19] The option of adding a security key to one's account is currently available only to users registered in the United States, Germany and Australia. [20]

Phishing

PayPal has developed substantial anti-Phishing resources[21], for identifying and reporting phishing. In the field of computer security phishing is the Criminally Fraudulent process of attempting to acquire sensitive information such as usernames Passwords

Entrepreneurship by former employees

A number of companies have been started and funded by former PayPal employees. This trend prompted The New York Times to publish a story entitled "It Pays to Have Pals in Silicon Valley" that analyzes the connections between several PayPal employees who went on to become influential. [22]

Criticism

In September 2005, the owner of the website Something Awful, Richard Kyanka, set up an account to collect donations for Hurricane Katrina, to be given to the Red Cross. Something Awful, often abbreviated to Hurricane Katrina of the 2005 Atlantic hurricane season was the costliest hurricane, as well as one of the five deadliest in the history of the United States The International Red Cross and Red Crescent Movement is an International humanitarian movement with approximately 97 million volunteers worldwide who stated Due to the high rate at which donations were made, the account was automatically frozen, and Kyanka criticized the time and difficulty involved in getting PayPal's customer service to unfreeze the account. In response to the concerns of Something Awful members over the charity used by Paypal, United Way, Kyanka finally opted to have the money refunded to the donors so that they could donate directly to their charities of choice, though Paypal did not refund exchange and handling fees for international donors. United Way of America, based in Alexandria Virginia, is a Non-profit organization that works with nearly 1300 local United Way offices throughout the country in [23][24]

In March 2008, Australian current affairs show "Today Tonight", aired a segment criticizing PayPal, in regards to safety, freezing accounts and customer service. [25]

Several PayPal gripe sites have been created complaining of frozen accounts and various other issues. A gripe site is a type of Website devoted to the Critique and or mockery of a Person, Place, Politician, Corporation or [26][27][28] Some of these include web forums where apparent unhappy customers share PayPal experiences. An, or message board, is a Bulletin board system in the form of a discussion site

Litigation

In 2002, CertCo filed a suit against PayPal claiming patent infringement concerning the use of distributed computing systems that process micropayments, or small cash amounts. CertCo was a financial Cryptography startup spun out of Bankers Trust in the 1990s In April of 2002, CertCo dropped the suit and stated that they had come to a settlement involving "a non-consequential payment and mutual releases. "[29]

In March 2002, two PayPal account holders separately sued the company for alleged violations of the Electronic Funds Transfer Act (EFTA) and California law. The Electronic Funds Transfer (EFT Act, also known as Regulation E, was implemented in the US in 1978 to establish the Rights and liabilities Most of the allegations concerned PayPal's dispute resolution procedures. The two lawsuits were merged into one class action lawsuit (In re PayPal litigation). An informal settlement was reached in November 2003, and a formal settlement was signed on June 11, 2004. Events 1184 BC - Trojan War: Troy is sacked and burned according to the calculations of Eratosthenes. "MMIV" redirects here For the Modest Mouse album see " Baron von Bullshit Rides Again " The settlement requires that PayPal change its business practices (including changing its dispute resolution procedures to make them EFTA-compliant), as well as making a US$9. 25 million payment to members of the class. PayPal denied any wrongdoing.

In May 2002, Tumbleweed Communications filed a lawsuit against PayPal (and later expanded it to include eBay) claiming that PayPal had violated its patents for sending personalized links through e-mail which PayPal uses to alert its customers about financial transactions. Tumbleweed Communications Corp provides secure messaging and secure file transfer solutions for enterprise and government customers In January 2004, the two parties came to an agreement, but didn't disclose the financial terms of their licensing agreement. [30]

In June 2003, Stamps.com filed a lawsuit against PayPal and eBay claiming breach of contract, breach of the implied covenants of good faith and fair dealing, and interference with contract, among other claims. Stampscom is a Los Angeles California -based company that provides Internet-based mailing and shipping services In a 2002 license agreement, Stamps. com and PayPal agreed that Stamps. com technology would be made available to allow PayPal users to buy and print postage online from their PayPal accounts. Stamps. com claimed that PayPal did not live up to its contractual obligations and accused eBay of interfering with PayPal and Stamps. com's agreement, hence Stamp. com's reasoning for including eBay in the suit. [31]

In August 2002, Craig Comb and others filed a class action against PayPal in Craig Comb, et al. v. PayPal, Inc. . They sued for alleged mishandling of customer accounts and customer services, with regards to PayPal's user agreement. Allegations included restricting deposited funds for up to 180 days until disputes are resolved, forcing customers to arbitrate their disputes under the American Arbitration Association's guidelines (a costly procedure), and requiring users to file claims individually, restricting class action suits. The American Arbitration Association ( AAA) is a private enterprise in the business of arbitration and one of several Arbitration organizations that administers arbitration The court stated that "the User Agreement and arbitration clause are substantively unconscionable under California law" and ruled in favor of Comb. [32]

In September 2003, PayPal filed suit against Bank One Corporation for patent infringement. Bank One Corporation, based in Chicago Illinois, was the sixth-largest Bank in the United States. PayPal claimed that Bank One's online bill-payment system was an infringement against their online bill-payment patent issued in 1998. PayPal filed the suit after a warning to the bank's lawyers in February went unabated. [33]

In November 2003, AT&T filed suit against eBay and PayPal claiming that their payment systems infringed an AT&T patent filed in 1991 and granted in 1994. Before proposing a merge request please see Talk and see if the merger you propose has recently been made and [34]

In March 2004, PayPal and New York state's Attorney General, Eliot Spitzer, came to an agreement to require PayPal to disclose clients' rights and liabilities more accurately and to pay $150,000 to the state of New York for penalties and the costs of the investigation. Eliot Laurence Spitzer (born June 10, 1959) is an American lawyer and former politician of the Democratic Party. [35]

See also


References

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  20. ^ PayPal Help Center
  21. ^ Security Center
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  23. ^ Wired News
  24. ^ E-Commerce News: Security: Feds Investigating Fraudulent Katrina-Related Web Sites
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  31. ^ Stamps.com Asserts Breach of Contract Claim Against PayPal and eBay (2008-04-23). 2008 ( MMVIII) is the current year in accordance with the Gregorian calendar, a Leap year that started on Tuesday of the Common Events 215 BC - A temple is built on the Capitoline Hill dedicated to Venus Erycina to commemorate the Roman defeat at
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  35. ^ Spitzer Obtains Agreement With E-Payment Service (2008-04-23). 2008 ( MMVIII) is the current year in accordance with the Gregorian calendar, a Leap year that started on Tuesday of the Common Events 215 BC - A temple is built on the Capitoline Hill dedicated to Venus Erycina to commemorate the Roman defeat at


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