In a move that will displace its former subsidiary PayPal, eBay is moving to manage the payments flow on its Marketplace platform internally. The e-Commerce retailer has signed an agreement with Adyen to become its primary payment processing partner, after eBay’s current agreement with PayPal expires in mid-2020.
While PayPal will remain a payment option for buyers, eBay predicts that a majority of its Marketplace customers will transition to the new payment experience by 2021.
The biggest change for buyers is that they will be able to stay within the eBay ecosystem for checkout rather than being directed to PayPal before completing a purchase. PayPal will remain as a checkout option on the eBay intermediated model until July 2023.
For sellers, most “can expect their costs of payments processing to be reduced after they transition to eBay’s intermediated payments model, and benefit from a simplified pricing structure and more predictable access to their funds,” according to a company statement. Sellers will not need to change their accounts with eBay, which has promised that they “can expect to see new, streamlined dashboards and reports inclusive of payments — all within eBay.”
The choice of Adyen to provide its back-end payment processing will allow eBay to expand payment options into more regions around the world, according to CNBC. The Netherlands-based Adyen lets consumers pay in 150 currencies and via more than 200 payment methods.