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Negotiation & Conflict Management Thomas Kilmann

1371 words - 6 pages

|Year |2013 |Exam Sitting |DECEMBER |

|Subject |E-COMMERCE |
|Weightage |25% |Submission Date |29/10/2013 |

Regulations

Deliverables

Students must submit all materials supporting their coursework listed in the deliverable section.

▪ The coursework must be done individually and must be entirely your own work. Please make sure that you are aware of the rules ...view middle of the document...

Peter Thiel, a hedge fund manager, and Max Levchin, an online security specialist, founded what was to become PayPal-it was first named Field Link and then Confinity and finally, in 2001, PayPal. The company went online rather naively in 1999. The founders' vision was to create a digital currency exchanges service free of government controls, but the site quickly became a target for hackers, con artists, and organized crime groups, who used the site for scams and money laundering. Tighter security measures halted criminal activity and helped assuage customers complaints, but government regulators moved in. Attorneys general in several states investigated PayPal's business practices, and New York and California levied fines for violations. Louisiana banned the company from operating in that state. When PAyPal began, payment for web products was made through credit card charges at the purchase site and via checks and money orders sent through the U.S postal other companies, such as Beenz.com and Flooz.com, had tried to establish electronic payment systems based on a special digital currency, but merchants, banks, and customers were hesitant to accept "money" that wasn't based on real dollars. Thiel and Levchin saw the need for an electronic payment system that relied on real currency, establish when eBay became popular, and PayPal filled that niche.

After PayPal solved its security and customer support problems, customers liked the convenience and ease of using the service, and its client base grew. Buyers like not having to reveal their credit card numbers to every online merchant, and merchants appreciate having PayPal handle payment collection. New PayPal clients establish an account with a user name and password and fund the account by giving PayPal a credit card number or bank account transaction information. Although PayPal prefers the latter (because bank account transactions are cheaper than credit card transactions), half of PayPal's account are funded via credit cards

eBay bought PayPal in 2002 for $1.5 billion and since then has also been a major source of income for the money transfer site. At the same time, PayPal has expanded its client base both in the United States and abroad and is generating much revenue by charging fees for payment processing for a wide variety of online vendors, auction sites, and corporations. Services to buyers are free, but sellers are charged a fee, which is generally lower than fees charged by major credit card companies. PayPal now offers special merchant accounts for transferring larger amounts of money and also offers a donation box feature for blogs and other web sites where visitors can make donations.

PayPal spawned many rivals after its initials launch, but most have since died, including Citigroup's C2it and Bank One's E-mail Money. As of 2010, PayPal operates in 190 worldwide markets, has localized Web sites in 17 countries, and manages over 78 million active accounts. PayPal allows...

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