#1
  1. No Profile Picture
    Contributing User
    Devshed Newbie (0 - 499 posts)

    Join Date
    Jun 2000
    Posts
    56
    Rep Power
    15

    What do you need to set up a paypal like system?


    Hi all,

    I'm new to this forum, so please be kind to me.

    I'm just wondering what exactly is needed legal wise to setup something like paypal. Not that I'm going to do it, but I am just curious. I know there must be some restriction, something like you have to have at least equal amount of money in another bank account as backup or something.

    --Ben.
    Being crazy is the only way to succeed...
  2. #2
  3. Type Cast Exception
    Devshed Supreme Being (6500+ posts)

    Join Date
    Apr 2004
    Location
    OAKLAND CA | Adam's Point (Fairyland)
    Posts
    14,954
    Rep Power
    8617
    You need lots of things, starting with a good lawyer and CPA. Funds transfers are (rightly) a highly regulated industry. Go poke around PayPal's "about" area a while, you'll note among things a plethora of state licenses they hold.
  4. #3
  5. No Profile Picture
    Contributing User
    Devshed Newbie (0 - 499 posts)

    Join Date
    Aug 2004
    Location
    Chicago, IL USA
    Posts
    40
    Rep Power
    10
    When dealing with money, there are a lot of legal issues to follow. First, Visa, Mastercard, etc.. requires a certain encryption bit to store their customers card info. Certain States, Countries have strict laws.

    Also, you need a domain. As well as a backend, such as JSP, CFM, etc..
    There are tons of other things, as medialint mention.
  6. #4
  7. Capt'n
    Devshed Novice (500 - 999 posts)

    Join Date
    May 2001
    Posts
    567
    Rep Power
    15
    Your best bet is to setup an actual Bank. There are a lot of regulations and rules tied to the money lending/payment industry. Paypal acts like a bank, but is not chartered as such and has used this to skirt some issues. For starters, Paypal accounts are not eliable for FDIC insurance and under their policies, they could close and confiscate funds in your account at anytime. They are not required to keep money in the federal reserve system to ensure liabilities can be covered in case of collapse like a bank.

    I do not deal with Paypal period. I used it once several years ago to buy something off Ebay and paid with credit card. When Paypal wanted me to give out my checking account number, I closed my account and never went back. Ebay buying Paypal has helped I think, but still they are under the watchful eye of many state Attourney Generals.

    Bottomline, unless you already have several million dollars or can find people to invest that amount in start-up, its not worth getting into.
    Why? Because Forms just look cooler in OS X...

    Dutch, it's like German...but not!

IMN logo majestic logo threadwatch logo seochat tools logo