Google Checkout vs. Paypal

About a year ago I started working with Cali Ten that is an e-commerce site. Although I haven’t had much experience in the past with e-commerce, I knew the logic behind it. Since then I have created three websites, each of them having some form of e-commerce integrated into them. I used both Google checkout and PayPal for different sites to accomplish the same thing, sell stuff online. Many of my clients ask for my professional opinion on these two similar methods and after researching and using each of them I wanted to write a little bit about the pros and cons of each service.

Google Checkout simply serves as a holding place for the shoppers credit or debit card information. It allows them to log in to a single Google username to shop, while hiding their valuable data and e-mail address from merchants. If you’re selling stuff on a Web site, you can cut and paste some code that lets visitors shop via Google Checkout, which takes a small cut of your sales. Copying and pasting the code isn’t hard but it can be very tedious if you have a large quantity of items.

PayPal’s fine print is more complicated than Google Checkout’s, but PayPal offers a wider variety of services for shoppers and businesses–particularly small ones–to exchange funds. Only PayPal lets shoppers transfer money to or from bank accounts in addition to credit and debit cards, and you can use it to wire money to other people without requiring them to get a paid account. And PayPal is the only way to go for international shoppers. Shopper’s financial details remain hidden from stores, but sellers will see their e-mail address. PayPal’s user base is 100 million strong, while Google Checkout is just getting off its feet. Only PayPal can be used to bid on or list auctions at eBay, which is good to know for those of you who plan on selling products on eBay. And thousands of merchants are already PayPal-enabled, while Google is still building partnerships with sellers.

How to make payments
PayPal: Your credit card, debit card, or bank account
Google: Your credit or debit card

International shopping
PayPal: 55 countries, 6 currencies (EU, CA, pound, US, yen, Australian)
Google: U.S. Only

Security
PayPal: SSL, same used by banks
Google: SSL, same used by banks

Fraud protection
PayPal: 100 percent refund for fraudulent transactions of $50 or more
Google: 100 percent refund (must report within 60 days) for fraudulent transactions

Fee for accepting payments on your own Web site
PayPal: 1.9 to 2.9 percent of sales plus 30 cents per transaction
Google: 2 percent of sales plus 20 cents per transaction

Calculates shipping and tax
PayPal: Yes
Google: No

All this being said, as a seller and buyer I prefer PayPal, it’s been around longer, they have more experience, and they are much more accommodating for small businesses. I’m sure that as time goes on and Google continues to tweak their service that the differences will diminish, but until then I’m sticking with PayPal.