ProPay and Billpoint are two services that allow sellers to accept credit cards for online auction transactions. Sellers never see the buyers' credit card numbers, so buyers have no fear of sharing that information with unknown sellers.

Note that ProPay and Billpoint are different from PayPal. PayPal conducts the credit card transaction and then puts the money into the seller's PayPal account; the service is free. With ProPay and Billpoint, it is the seller's name that appears on the credit card statement, and they charge the seller per-transaction fees.

Because the seller is acting as the merchant in the case of ProPay and Billpoint, buyers can use their credit card company's dispute resolution service against sellers (they cannot with PayPal). According to a ProPay spokesperson, the only time the seller has to worry about a dispute is if he/she either: a.) didn't send the product or, b.) didn't ship what was described. "It is not as if the buyer can do a chargeback on whim."

Billpoint is currently limited to eBay auctions. ProPay can be used in any online or offline transaction.

How It Works
The Seller enters the Buyer's email address, final bid amount, and a short bid description into a form on the ProPay or Billpoint Web site. The Buyer receives an email with directions to a unique URL, which goes to a secure site. The Buyer enters her credit card information, and then ProPay or Billpoint then deposits the money into the Seller's account, less the fee, of course. The Seller must have an account with ProPay or Billpoint. (The Buyer does not need an account to pay the Seller).

Fees
It is free to open a ProPay and Billpoint account. The companies charge Sellers for each transaction. There is no charge to Buyers. Fees are calculated on the total transaction amount (the total amount that the Seller charges to the Buyer's credit card).

At the time of this writing, ProPay only allows individuals to use its service. It charges 3.5% plus 35 cents for each transaction. ProPay limits each transaction to $250 and $1,000 in payments each month

Billpoint has a Standard Service and charges 3.9% plus 39 cents per transaction. The Billpoint Standard Service limits each transaction to $500.

Billpoint also has a Merchant Service Account. To qualify, you must have eBay sales of greater than $1,000 per month, a minimum of 6 months on eBay, 96%+ positive feedback rating, and good eBay account status. The fee is 3.5% plus 35 cents per transaction. Billpoint Merchant Service limits each transaction to $2,000.

Show Me the Money
How do sellers get the money from their ProPay and Billpoint accounts? To retrieve money from your ProPay account, you must use ProPay's Send Cash service, for which there is a 35 cent charge. It usually takes 48 hours for the money to appear in the account.

EBay's Billpoint service puts the money directly into the seller's bank account, usually within seven business days after the buyer's card is charged.

Note that the companies are likely to change fees and limitations on these services, so check their Web sites for the latest information. And be sure and look at the AuctionBytes chart comparing payment methods for more information (see next story).