[MUD-Dev] Payment Transaction Processing

Matt Mihaly the_logos at ironrealms.com
Mon Dec 8 08:29:40 New Zealand Daylight Time 2003


On Thu, 4 Dec 2003, Jason Smith wrote:

> One caution about PayPal - when using it as the means for
> non-physical goods transactions (ie, as a payment processor for a
> subscription service) at any time a subscriber can retroactively
> cancel all previous payments, with very little recourse available
> to the service provider. This was one major reason why Jumpgate
> switched from using a purely PayPal payment method to the
> PayByCash-provided systems. There was simply no guarantee that a
> user wouldn't simply cancel and reclaim all their past payments,
> and that's quite a bit of risk (especially for a small company).

Just keep in mind that's not limited to Paypal. That's the case with
merchant accounts generally. It is, however (and happily) possible
to drastically reduce fraud by developing algorithms and methods to
detect fraud by customer behavior. Your typical defrauder actually
engages in fairly typical patterns of spending behavior we've found,
and we've been able to reduce fraud quite a lot. It used to be a
sleep-losing concern of mine but its status as a worry has declined
enormously in the last couple of years.

--matt
Where are the WMDs, Georgie boy?
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