Even the Russian Electronic Payments Provider Knows Secure Authentication. PayPal?

January 19, 2009 | 

Svetlana Gladkova


Fingerprint authentication now available to WebMoney users but not to PayPalNow that I think about the nightmare that setting my PayPal account was initially some 3 years ago, I can’t help but feel that I will hardly ever be able to employ enough efforts to go through the procedure again even if I have to. I have already written about the multiple limitations that many well-known international services have when dealing with international users and about PayPal in particular with PayPal being the reason for many complaints.

In fact, when I asked my Twitter followers about the most disturbing limitation that they face online as international users, many mentioned PayPal difficulties as their most serious concern. For those lucky ones living in the US and more privileged countries to get a general understanding of the situation, there are people in other countries who don’t enjoy PayPal in the same manner that you do. In fact, the vast majority of countries supported by PayPal are populated with people who can only use PayPal to send money (by linking a credit card to fund a PayPal account) but can never receive anything.

This terrible limitation leaves many freelancers – be it web designers, translators or writers – without any payment option that is generally acceptable by international outsourcers in the US and Western Europe and prevent such freelancers (often talented ones) from competing on various online marketplaces where outsourcers usually expect a freelancer to be able to accept a payment for a project online via PayPal and will hardly ever bother with wire transfer which is usually pretty much the only way such international freelancers can receive money for their work. Believe me, this is truly a huge problem for many of us, those trying to make money without leaving the comfort of our homes and safely planted on our sofas behind out laptops doing what we like to do mostly online and hoping to get paid for it.

Of course I do realize that this situation has nothing (or not everything at least) to do with PayPal’s unwillingness to serve customers around the world at the same level as they serve those living in the US. Most certainly it is about the complicated financial and banking systems locally that prevent PayPal from entering these local markets due to all the formalities they will have to pass that will probably be virtually unmanageable.

But my idea for this post is that PayPal still seems to lag behind other newer providers of the online payment processing without trying to innovate in the way the market leader actually should. All in all, it sometimes looks to me that PayPal behaves like some type of a dinosaur without trying to offer advanced solutions where even the small players are very eager to.

Today’s example arrives from one of the most important electronic payments provider in Russia – Webmoney – that has announced that they are introducing a new authentication method to their users in order to make sure our payments are fully protected. The new authentication is based on reading fingerprints and requires one to have a fingerprint reader (an external one or integrated in a notebook) and dedicated software installed to connect the fingerprints’ owner with the WebMoney account. This new authentication method certainly looks like a very secure one and will not allow anyone to access a WebMoney account without prior authorization.

In contrast, I remember the nightmare that proving my identity to PayPal was to get the “verified member” status. In addition to providing them with scans of quite a number of my identity documents like passport (it took them more than a week to review the submitted documents and authorize me to use my account) they also requested me to provide them with a utilities bill in my name to prove I am actually the person I claim I am. And should I really mention that utilities bills are in Russian here and I also had to translate the document into English to make sure they will believe it is actually what they wanted to have?

Along with dozens of emails and phone calls to support center this was the ugliest authentication process I’ve ever had to pass and I can’t imagine the leading provider of online payments processing being so behind the relatively small provider based in Russia, the country with terrible financial regulations that can easily drive one mad. Yet for now it is PayPal driving international users mad.

Besides, it really looks to me that adding a technology like this one could be a great measure in anti-phishing protection as an alternative to trying to explain to the internet users they should not give their PayPal accounts credentials to sites that don’t look like secure ones and blocking accounts of international users accessing the same account from different IPs (it actually happens, no matter how hard it may be to believe me – even though this is an ONLINE payments provider so you are supposed to be able to access it from anywhere). So to me it looks like PayPal does not even try to keep abreast with the times and acts instead like they don’t even want to be the leader in online payments any more as leadership means innovation these days. Really, security does not mean having a special section on your site explaining what it is and making your users’ lives complicated if they do something that does not look like normal activity to you.

Via (in Russian)

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