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This excerpt taken from the EBAY 10-K filed Feb 17, 2010. Changes in PayPal’s funding mix could adversely affect PayPal’s results. PayPal pays significant transaction fees when customers fund payment transactions using credit cards, lower payments when customers fund payments with debit cards, nominal fees when customers fund payment transactions by electronic transfer of funds from bank accounts, and no fees when customers fund payment transactions from an existing PayPal account balance or use buyer credit issued by GE Money Bank. As of October 2009, eligible U.S. customers may also fund payment transactions through a loan originated by CIT Bank in the Bill Me Later service, and PayPal will incur no fees for such transactions. Customers fund a significant portion of PayPal’s payment volume using credit cards, and PayPal’s financial success will remain highly sensitive to changes in the rate at which its senders fund payments using credit cards. Senders may prefer funding using credit cards rather than bank account transfers for a number of reasons, including the ability to dispute and reverse charges directly with their credit card provider if merchandise is not delivered or is not as described, the ability to earn frequent flier miles, cash rebates, or other incentives offered by credit card issuers, the ability to defer payment, or a reluctance to provide bank account information to PayPal. In addition, some of PayPal’s offerings, including the ability to make a limited number of payments without opening an account, have a higher rate of credit card funding than PayPal’s basic product offering. This excerpt taken from the EBAY 10-Q filed Apr 28, 2009. Changes in PayPal’s funding mix could adversely affect PayPal’s results. PayPal pays significant transaction fees when senders fund payment transactions using credit cards, nominal fees when customers fund payment transactions by electronic transfer of funds from bank accounts, and no fees when customers fund payment transactions from an existing PayPal account balance or use buyer credit issued by GE Money Bank. Senders fund a significant portion of PayPal’s payment volume using credit cards, and PayPal’s financial success will remain highly sensitive to changes in the rate at which its senders fund payments using credit cards. Senders may prefer funding using credit cards rather than bank account transfers for a number of reasons, including the ability to dispute and reverse charges directly with their credit card provider if merchandise is not delivered or is not as described, the ability to earn frequent flier miles or other incentives offered by credit card issuers, the ability to defer payment, or a reluctance to provide bank account information to PayPal. The proportion of PayPal’s payment volume funded using credit cards has increased over time. In addition, some of PayPal’s newer offerings, including the ability to make a limited number of payments without opening an account, have a higher rate of credit card funding than PayPal’s basic product offering. In September 2006, PayPal entered into a settlement agreement with the attorneys general of a number of states under which it agreed to pay $1.7 million to the attorneys general, shorten and streamline its user agreement, and communicate more information regarding protection programs to users. Also in September 2006, PayPal announced that it had reached a preliminary settlement agreement under which it agreed to pay approximately $3.5 million into a settlement fund for the benefit of a class represented by plaintiffs in a suit that alleged, among other things, that PayPal’s disclosure regarding the effects of users’ choice of funding mechanism was deceptive. This settlement has now been preliminarily approved by the court. Although PayPal did not admit any liability for any of the allegations in the two cases, changes to our disclosure practices could result in increased use of credit card funding, which could harm PayPal’s business. These excerpts taken from the EBAY 10-K filed Feb 20, 2009. Changes
in PayPal’s funding mix could adversely affect
PayPal’s results.
PayPal pays significant transaction fees when senders fund
payment transactions using credit cards, nominal fees when
customers fund payment transactions by electronic transfer of
funds from bank accounts, and no fees when customers fund
payment transactions from an existing PayPal account balance or
use buyer credit issued by GE Money Bank. Senders fund a
significant portion of PayPal’s payment volume using credit
cards, and PayPal’s financial success will remain highly
sensitive to changes in the rate at which its senders fund
payments using credit cards. Senders may prefer funding using
credit cards rather than bank account transfers for a number of
reasons,
Table of Contents
including the ability to dispute and reverse charges directly
with their credit card provider if merchandise is not delivered
or is not as described, the ability to earn frequent flier miles
or other incentives offered by credit card issuers, the ability
to defer payment, or a reluctance to provide bank account
information to PayPal. The proportion of PayPal’s payment
volume funded using credit cards has increased over time. In
addition, some of PayPal’s newer offerings, including the
ability to make a limited number of payments without opening an
account, have a higher rate of credit card funding than
PayPal’s basic product offering. In September 2006, PayPal
entered into a settlement agreement with the attorneys general
of a number of states under which it agreed to pay
$1.7 million to the attorneys general, shorten and
streamline its user agreement, and communicate more information
regarding protection programs to users. Also in September 2006,
PayPal announced that it had reached a preliminary settlement
agreement under which it agreed to pay approximately
$3.5 million into a settlement fund for the benefit of a
class represented by plaintiffs in a suit that alleged, among
other things, that PayPal’s disclosure regarding the
effects of users’ choice of funding mechanism was
deceptive. This settlement has now been approved by the court.
Although PayPal did not admit any liability for any of the
allegations in the two cases, changes to our disclosure
practices could result in increased use of credit card funding,
which could harm PayPal’s business.
Changes in PayPal’s funding mix could adversely affect PayPal’s results. PayPal pays significant transaction fees when senders fund payment transactions using credit cards, nominal fees when customers fund payment transactions by electronic transfer of funds from bank accounts, and no fees when customers fund payment transactions from an existing PayPal account balance or use buyer credit issued by GE Money Bank. Senders fund a significant portion of PayPal’s payment volume using credit cards, and PayPal’s financial success will remain highly sensitive to changes in the rate at which its senders fund payments using credit cards. Senders may prefer funding using credit cards rather than bank account transfers for a number of reasons,
Table of Contentsincluding the ability to dispute and reverse charges directly with their credit card provider if merchandise is not delivered or is not as described, the ability to earn frequent flier miles or other incentives offered by credit card issuers, the ability to defer payment, or a reluctance to provide bank account information to PayPal. The proportion of PayPal’s payment volume funded using credit cards has increased over time. In addition, some of PayPal’s newer offerings, including the ability to make a limited number of payments without opening an account, have a higher rate of credit card funding than PayPal’s basic product offering. In September 2006, PayPal entered into a settlement agreement with the attorneys general of a number of states under which it agreed to pay $1.7 million to the attorneys general, shorten and streamline its user agreement, and communicate more information regarding protection programs to users. Also in September 2006, PayPal announced that it had reached a preliminary settlement agreement under which it agreed to pay approximately $3.5 million into a settlement fund for the benefit of a class represented by plaintiffs in a suit that alleged, among other things, that PayPal’s disclosure regarding the effects of users’ choice of funding mechanism was deceptive. This settlement has now been approved by the court. Although PayPal did not admit any liability for any of the allegations in the two cases, changes to our disclosure practices could result in increased use of credit card funding, which could harm PayPal’s business. This excerpt taken from the EBAY 10-Q filed Oct 23, 2008. Changes
in PayPal’s funding mix could adversely affect
PayPal’s results.
PayPal pays significant transaction fees when senders fund
payment transactions using credit cards, nominal fees when
customers fund payment transactions by electronic transfer of
funds from bank accounts, and no fees when customers fund
payment transactions from an existing PayPal account balance or
use buyer credit issued by GE Money Bank. Senders fund a
significant portion of PayPal’s payment volume using credit
cards, and PayPal’s financial success will remain highly
sensitive to changes in the rate at which its senders fund
payments using credit cards. Senders may prefer funding using
credit cards rather than bank account transfers for a number of
reasons, including the ability to dispute and reverse charges
directly with their credit card provider if merchandise is not
delivered or is not as described, the ability to earn frequent
flier miles or other incentives offered by credit card issuers,
the ability to defer payment, or a reluctance to provide bank
account information to PayPal. The proportion of PayPal’s
payment volume funded using credit cards has increased over
time. In addition, some of PayPal’s newer offerings,
including the ability to make a limited number of payments
without opening an account, have a higher rate of credit card
funding than PayPal’s basic product offering. In September
2006, PayPal entered into a settlement agreement with the
attorneys general of a number of states under which it agreed to
pay $1.7 million to the attorneys general, shorten and
streamline its user agreement, and communicate more information
regarding protection programs to users. Also in September 2006,
PayPal announced that it had reached a preliminary settlement
agreement under which it agreed to pay approximately
$3.5 million into a settlement fund for the benefit of a
class represented by plaintiffs in a suit that alleged, among
other things, that PayPal’s disclosure regarding the
effects of users’ choice of funding mechanism was
deceptive. This settlement has now been approved by the court.
Although PayPal did not admit any liability for any of the
allegations in the two cases, changes to our disclosure
practices could result in increased use of credit card funding,
which could harm PayPal’s business.
This excerpt taken from the EBAY 10-Q filed Jul 24, 2008. Changes
in PayPal’s funding mix could adversely affect
PayPal’s results.
PayPal pays significant transaction fees when senders fund
payment transactions using credit cards, nominal fees when
customers fund payment transactions by electronic transfer of
funds from bank accounts, and no fees when customers fund
payment transactions from an existing PayPal account balance or
use buyer credit issued by GE Money Bank. Senders fund a
significant portion of PayPal’s payment volume using credit
cards, and PayPal’s financial success will remain highly
sensitive to changes in the rate at which its senders fund
payments using credit cards. Senders may prefer funding using
credit cards rather than bank account transfers for a number of
reasons, including the ability to dispute and reverse charges
directly with their credit card provider if merchandise is not
delivered or is not as described, the ability to earn frequent
flier miles or other incentives offered by credit card issuers,
the ability to defer payment, or a reluctance to provide bank
account information to PayPal. The proportion of PayPal’s
payment volume funded using credit cards has increased over
time. In addition, some of PayPal’s newer offerings,
including the ability to make a limited number of payments
without opening an account, have a higher
Table of Contents
rate of credit card funding than PayPal’s basic product
offering. In September 2006, PayPal entered into a settlement
agreement with the attorneys general of a number of states under
which it agreed to pay $1.7 million to the attorneys
general, shorten and streamline its user agreement, and
communicate more information regarding protection programs to
users. Also in September 2006, PayPal announced that it had
reached a preliminary settlement agreement under which it agreed
to pay approximately $3.5 million into a settlement fund
for the benefit of a class represented by plaintiffs in a suit
that alleged, among other things, that PayPal’s disclosure
regarding the effects of users’ choice of funding mechanism
was deceptive. This settlement was initially rejected by the
court, and the parties have submitted a revised settlement
agreement to the court. Although PayPal did not admit any
liability for any of the allegations in the two cases, changes
to our disclosure practices could result in increased use of
credit card funding, which could harm PayPal’s business.
This excerpt taken from the EBAY 10-Q filed Apr 24, 2008. Changes
in PayPal’s funding mix could adversely affect
PayPal’s results.
PayPal pays significant transaction fees when senders fund
payment transactions using credit cards, nominal fees when
customers fund payment transactions by electronic transfer of
funds from bank accounts, and no fees when customers fund
payment transactions from an existing PayPal account balance or
use buyer credit issued by GE Money Bank. Senders fund a
significant portion of PayPal’s payment volume using credit
cards, and PayPal’s financial success will remain highly
sensitive to changes in the rate at which its senders fund
payments using credit cards. Senders may prefer funding using
credit cards rather than bank account transfers for a number of
reasons, including the ability to dispute and reverse charges
directly with their credit card provider if merchandise is not
Table of Contents
delivered or is not as described, the ability to earn frequent
flier miles or other incentives offered by credit card issuers,
the ability to defer payment, or a reluctance to provide bank
account information to PayPal. In addition, some of
PayPal’s newer offerings, including the ability to make a
limited number of payments without opening an account, have a
higher rate of credit card funding than PayPal’s basic
product offering. In September 2006, PayPal entered into a
settlement agreement with the attorneys general of a number of
states under which it agreed to pay $1.7 million to the
attorneys general, shorten and streamline its user agreement,
and communicate more information regarding protection programs
to users. Also in September 2006, PayPal announced that it had
reached a preliminary settlement agreement under which it agreed
to pay approximately $3.5 million into a settlement fund
for the benefit of a class represented by plaintiffs in a suit
that alleged, among other things, that PayPal’s disclosure
regarding the effects of users’ choice of funding mechanism
was deceptive. This settlement was initially rejected by the
court, and the parties are in the process of submitting a
revised settlement agreement to the court. Although PayPal did
not admit any liability for any of the allegations in the two
cases, changes to our disclosure practices could result in
increased use of credit card funding, which would harm
PayPal’s business.
This excerpt taken from the EBAY 10-Q filed Apr 24, 2008. Changes
in PayPal’s funding mix could adversely affect
PayPal’s results.
PayPal pays significant transaction fees when senders fund
payment transactions using credit cards, nominal fees when
customers fund payment transactions by electronic transfer of
funds from bank accounts, and no fees when customers fund
payment transactions from an existing PayPal account balance or
use buyer credit issued by GE Money Bank. Senders fund a
significant portion of PayPal’s payment volume using credit
cards, and PayPal’s financial success will remain highly
sensitive to changes in the rate at which its senders fund
payments using credit cards. Senders may prefer funding using
credit cards rather than bank account transfers for a number of
reasons, including the ability to dispute and reverse charges
directly with their credit card provider if merchandise is not
Table of Contents
delivered or is not as described, the ability to earn frequent
flier miles or other incentives offered by credit card issuers,
the ability to defer payment, or a reluctance to provide bank
account information to PayPal. In addition, some of
PayPal’s newer offerings, including the ability to make a
limited number of payments without opening an account, have a
higher rate of credit card funding than PayPal’s basic
product offering. In September 2006, PayPal entered into a
settlement agreement with the attorneys general of a number of
states under which it agreed to pay $1.7 million to the
attorneys general, shorten and streamline its user agreement,
and communicate more information regarding protection programs
to users. Also in September 2006, PayPal announced that it had
reached a preliminary settlement agreement under which it agreed
to pay approximately $3.5 million into a settlement fund
for the benefit of a class represented by plaintiffs in a suit
that alleged, among other things, that PayPal’s disclosure
regarding the effects of users’ choice of funding mechanism
was deceptive. This settlement was initially rejected by the
court, and the parties are in the process of submitting a
revised settlement agreement to the court. Although PayPal did
not admit any liability for any of the allegations in the two
cases, changes to our disclosure practices could result in
increased use of credit card funding, which would harm
PayPal’s business.
These excerpts taken from the EBAY 10-K filed Feb 29, 2008. Changes
in PayPal’s funding mix could adversely affect
PayPal’s results.
PayPal pays significant transaction fees when senders fund
payment transactions using credit cards, nominal fees when
customers fund payment transactions by electronic transfer of
funds from bank accounts, and no fees when customers fund
payment transactions from an existing PayPal account balance or
use buyer credit issued by GE Money Bank. Senders fund a
significant portion of PayPal’s payment volume using credit
cards, and PayPal’s financial success will remain highly
sensitive to changes in the rate at which its senders fund
payments using credit cards. Senders may prefer funding using
credit cards rather than bank account transfers for a number of
reasons, including the ability to dispute and reverse charges
directly with their credit card provider if merchandise is not
delivered or is not as described, the ability to earn frequent
flier miles or other incentives offered by credit card issuers,
the ability to defer payment, or a reluctance to provide bank
account information to PayPal. In addition, some of
PayPal’s newer offerings, including the ability to make a
limited number of payments without opening an account, have a
higher rate of credit card funding than PayPal’s basic
product offering. In September 2006, PayPal entered into a
settlement agreement with the attorneys general of a number of
states under which it agreed to pay $1.7 million to the
attorneys general, shorten and streamline its user agreement,
and communicate more information regarding protection programs
to users. Also in September 2006, PayPal announced that it had
reached a preliminary settlement agreement under which it agreed
to pay approximately $3.5 million into a settlement fund
for the benefit of a class represented by plaintiffs in a suit
that alleged, among other things, that PayPal’s disclosure
regarding the effects of users’ choice of funding mechanism
was deceptive. This settlement was rejected by the court.
Although PayPal did not admit any liability for any of the
allegations in the two cases, changes to our disclosure
practices could result in increased use of credit card funding,
which would harm PayPal’s business.
Changes in PayPal’s funding mix could adversely affect PayPal’s results. PayPal pays significant transaction fees when senders fund payment transactions using credit cards, nominal fees when customers fund payment transactions by electronic transfer of funds from bank accounts, and no fees when customers fund payment transactions from an existing PayPal account balance or use buyer credit issued by GE Money Bank. Senders fund a significant portion of PayPal’s payment volume using credit cards, and PayPal’s financial success will remain highly sensitive to changes in the rate at which its senders fund payments using credit cards. Senders may prefer funding using credit cards rather than bank account transfers for a number of reasons, including the ability to dispute and reverse charges directly with their credit card provider if merchandise is not delivered or is not as described, the ability to earn frequent flier miles or other incentives offered by credit card issuers, the ability to defer payment, or a reluctance to provide bank account information to PayPal. In addition, some of PayPal’s newer offerings, including the ability to make a limited number of payments without opening an account, have a higher rate of credit card funding than PayPal’s basic product offering. In September 2006, PayPal entered into a settlement agreement with the attorneys general of a number of states under which it agreed to pay $1.7 million to the attorneys general, shorten and streamline its user agreement, and communicate more information regarding protection programs to users. Also in September 2006, PayPal announced that it had reached a preliminary settlement agreement under which it agreed to pay approximately $3.5 million into a settlement fund for the benefit of a class represented by plaintiffs in a suit that alleged, among other things, that PayPal’s disclosure regarding the effects of users’ choice of funding mechanism was deceptive. This settlement was rejected by the court. Although PayPal did not admit any liability for any of the allegations in the two cases, changes to our disclosure practices could result in increased use of credit card funding, which would harm PayPal’s business. This excerpt taken from the EBAY 10-Q filed Oct 29, 2007. Changes
in PayPal’s funding mix could adversely affect
PayPal’s results.
PayPal pays significant transaction fees when senders fund
payment transactions using credit cards, nominal fees when
customers fund payment transactions by electronic transfer of
funds from bank accounts, and no fees when customers fund
payment transactions from an existing PayPal account balance.
Senders fund a significant portion of PayPal’s payment
volume using credit cards, and PayPal’s financial success
will remain highly sensitive to changes in the rate at which its
senders fund payments using credit cards. Senders may prefer
funding using credit cards rather than bank account transfers
for a number of reasons, including the ability to dispute and
reverse charges directly with their credit card provider if
merchandise is not delivered or is not as described, the ability
to earn frequent flier miles or other incentives offered by
credit card issuers, the ability to defer payment, or a
reluctance to provide bank account information to PayPal. In
addition, some of PayPal’s newer offerings, including the
ability to make a limited number of payments without opening an
account, have a higher rate of credit card funding than
PayPal’s basic product offering. In September 2006, PayPal
entered into a settlement agreement with the attorneys general
of a number of states under which it agreed to pay
$1.7 million to the attorneys general, shorten and
streamline its user agreement, and communicate more information
regarding protection programs to users. Also in September 2006,
PayPal announced that it had reached a preliminary settlement
agreement under which it agreed to pay approximately
$3.5 million into a settlement fund for the benefit of a
class represented by plaintiffs in a suit that alleged, among
other things, that PayPal’s disclosure regarding the
effects of users’ choice of funding mechanism was
deceptive. This settlement was recently rejected by the court.
Although PayPal did not admit any liability for any of the
allegations in the two cases, changes to our disclosure
practices could result in increased use of credit card funding,
which would harm PayPal’s business.
This excerpt taken from the EBAY 10-Q filed Jul 27, 2007. Changes
in PayPal’s funding mix could adversely affect
PayPal’s results.
PayPal pays significant transaction fees when senders fund
payment transactions using credit cards, nominal fees when
customers fund payment transactions by electronic transfer of
funds from bank accounts, and no fees when customers fund
payment transactions from an existing PayPal account balance.
Senders fund a significant portion of PayPal’s payment
volume using credit cards, and PayPal’s financial success
will remain highly sensitive to changes in the rate at which its
senders fund payments using credit cards. Senders may prefer
funding using credit cards rather than bank account transfers
for a number of reasons, including the ability to dispute and
reverse charges directly with their credit card provider if
merchandise is not delivered or is not as described, the ability
to earn frequent flier miles or other incentives offered by
credit card issuers, the ability to defer payment, or a
reluctance to provide bank account information to PayPal. In
addition, some of PayPal’s newer offerings, including the
ability to make a limited number of payments without opening an
account, have a higher rate of credit card funding than
PayPal’s basic product offering. In September 2006, PayPal
entered into a settlement agreement with the attorneys general
of a number of states under which it agreed to pay
$1.7 million to the attorneys general, shorten and
streamline its user agreement, and communicate more information
regarding protection programs to users. Also in September 2006,
PayPal announced that it had reached a preliminary settlement
agreement under which it agreed to pay approximately
$3.5 million into a settlement fund for the benefit of a
class represented by plaintiffs in a suit that alleged, among
other things, that PayPal’s disclosure regarding the
effects of users’ choice of funding mechanism was
deceptive. Although PayPal did not admit any liability for any
of the allegations in the two cases, the required changes to our
disclosure practices under the settlement agreements could
result in increased use of credit card funding, which would harm
PayPal’s business.
This excerpt taken from the EBAY 10-Q filed Apr 25, 2007. Changes
in PayPal’s funding mix could adversely affect
PayPal’s results.
PayPal pays significant transaction fees when senders fund
payment transactions using credit cards, nominal fees when
customers fund payment transactions by electronic transfer of
funds from bank accounts, and no fees when customers fund
payment transactions from an existing PayPal account balance.
Senders fund a significant portion of PayPal’s payment
volume using credit cards, and PayPal’s financial success
will remain highly sensitive to changes in the rate at which its
senders fund payments using credit cards. Senders may prefer
funding using credit cards rather than bank account transfers
for a number of reasons, including the ability to dispute and
reverse charges
Table of Contents
if merchandise is not delivered or is not as described, the
ability to earn frequent flier miles or other incentives offered
by credit cards, the ability to defer payment, or a reluctance
to provide bank account information to PayPal. In addition, some
of PayPal’s newer products have a higher rate of credit
card funding than PayPal’s basic product offering. In
September 2006, PayPal entered into a settlement agreement with
the attorneys general of a number of states under which it
agreed to pay $1.7 million to the attorneys general,
shorten and streamline its user agreement, and communicate more
information regarding protection programs to users. Also in
September 2006, PayPal announced that it had reached a
preliminary settlement agreement under which it agreed to pay
approximately $3.5 million into a settlement fund for the
benefit of a class represented by plaintiffs in a suit that
alleged, among other things, that PayPal’s disclosure
regarding the effects of users’ choice of funding mechanism
was deceptive. Although PayPal did not admit any liability for
any of the allegations in the two cases, the required changes to
our disclosure practices under the settlement agreements could
result in increased use of credit card funding, which would harm
PayPal’s business.
This excerpt taken from the EBAY 10-K filed Feb 28, 2007. Changes
in PayPal’s funding mix could adversely affect
PayPal’s results.
PayPal pays significant transaction fees when senders fund
payment transactions using credit cards, nominal fees when
customers fund payment transactions by electronic transfer of
funds from bank accounts, and no fees when customers fund
payment transactions from an existing PayPal account balance.
Senders fund a significant portion of PayPal’s payment
volume using credit cards, and PayPal’s financial success
will remain highly sensitive to changes in the rate at which its
senders fund payments using credit cards. Senders may prefer
funding using credit cards rather than bank account transfers
for a number of reasons, including the ability to dispute and
reverse charges if merchandise is not delivered or is not as
described, the ability to earn frequent flier miles or other
incentives offered by credit cards, the ability to defer
payment, or a reluctance to provide bank account information to
PayPal. In addition, some products that PayPal is introducing as
it expands its business are expected to have a higher rate of
credit card funding than PayPal’s current rate. In
September 2006, PayPal entered into a settlement agreement with
the attorneys general of a number of states under which it
agreed to pay $1.7 million to the attorneys general,
shorten and streamline its user agreement, and communicate more
information regarding protection programs to users. Also in
September 2006, PayPal announced that it had reached a
preliminary settlement agreement under which it agreed to pay
approximately $3.5 million into a settlement fund for the
benefit of a class represented by plaintiffs in a suit that
alleged, among other things, that PayPal’s disclosure
regarding the effects of users’ choice of funding mechanism
was deceptive. Although PayPal did not admit any liability for
any of the allegations in the two cases, the required changes to
our disclosure practices under the settlement agreements could
result in increased use of credit card funding, which would harm
PayPal’s business.
Table of Contents
This excerpt taken from the EBAY 10-Q filed Jul 28, 2006. Changes
in PayPal’s funding mix could adversely affect
PayPal’s results.
PayPal pays significant transaction fees when senders fund
payment transactions using credit cards, nominal fees when
customers fund payment transactions by electronic transfer of
funds from bank accounts, and no fees
Table of Contents
when customers fund payment transactions from an existing PayPal
account balance. Senders fund a significant portion of
PayPal’s payment volume using credit cards, and
PayPal’s financial success will remain highly sensitive to
changes in the rate at which its senders fund payments using
credit cards. Senders may prefer funding using credit cards
rather than bank account transfers for a number of reasons,
including the ability to dispute and reverse charges if
merchandise is not delivered or is not as described, the ability
to earn frequent flier miles or other incentives offered by
credit cards, the ability to defer payment, or a reluctance to
provide bank account information to PayPal. PayPal has received
inquiries regarding its disclosure practices with regard to
funding mechanisms from the attorneys general of a number of
states, and in March 2005, a complaint seeking class action
status was filed alleging, among other things, that
PayPal’s disclosure regarding the effects of users’
choice of funding mechanism is deceptive. While we believe
PayPal’s disclosure is legal and accurate, any required
change to our disclosure practices could result in increased use
of credit card funding, damaging PayPal’s business.
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