When eBay.com instituted an electronics-only payment policy last fall, it meant the majority of transactions were processed through its PayPal subsidiary. When PayPal went down for all users worldwide for an hour on Monday, and continued to be inaccessible to some users for an additional 3 hours, it meant that eBay suffered as well, since many shoppers were unable to complete transactions.
eBay said last month that the PayPal penetration rate on its site was up to 64.4% globally. The U.S. site currently allows merchants to use their own credit card accounts and also allows sellers to accept ProPay, PayMate and Moneybookers, but those services have far less name recognition in the United States.
PayPal spokesperson Charlotte Hill said Monday's main outage was from 1:30-2:30 PM ET with scattered problems through 6:10 PM ET. PayPal believes the root cause of the problem was a bad piece of hardware, and Hill said PayPal is looking into compensating merchants.
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