Online credit card payment processing on behalf of others

Question

Does anyone know a way to facilitate payment between two parties via our website similar to how eBay facilitates payments between sellers and buyers, with buyers using their credit cards to make the purchases? We built a solution around PayPal, but now PayPal is telling us that we cannot use it because that is against the credit card association rules.

Here's what they wrote:

Per our Acceptable Use Policy, under credit card association rules, PayPal cannot permit the use of the PayPal service as a funding method for payment processors to collect payments on behalf of merchants.

I would be greatful for any leads. As a start-up, third-party payment aggregation services are very cost-prohibitive.

Answer 1

I think you need to set yourself up as an escrow service between the buyers and sellers. Rentacoder.com does something like this: http://www.rentacoder.com/RentACoder/DotNet/SoftwareBuyers/SoftwareBuyerFAQ.aspx#SafeProjectEscrow

If you are looking to move away from paypal and not be an escrow service yourself, look at escrow.com and its competitors to just use an escrow service.