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Product summary
The good: Generous sending and receiving limits; slightly lower fees for payments funded with a credit card.
The bad: Charges a fee for all transactions; sends activation info via snail mail; handles only transactions made in the United States.
The bottom line: Avoid Yahoo PayDirect if you're looking for a quick way to send cash. For now, PayPal is an all-around better bet.
CNET editors' review
- Reviewed on: 04/09/2002
Hand over your SSN
PayDirect makes you jump through some serious hoops to sign up. Unlike PayPal, PayDirect verifies your mailing address, so you'll have to wait a week or more for an activation code to arrive via snail mail. Until then, you can send or receive up to only $200, and you'll have to wait even if you use a credit card to fund your payments. Here's another gripe: PayDirect requires you to hand over your Social Security number. According to Yahoo, the company does this to "assist the federal authorities in preventing money-laundering." PayPal, on the other hand, doesn't require your SSN.
Like every service associated with Yahoo (Yahoo Mail, for example), PayDirect relies on an all-text interface--much plainer than PayPal's. Nonetheless, PayDirect is clear and easy to operate, with links to Send Money and Request Money forms at the top, and your account balance and recent transactions clearly displayed.
Unlike PayPal, PayDirect doesn't sport many extras. Although money in your PayDirect account is FDIC insured, there's no option to transfer funds to an interest-bearing account, as you can with PayPal. Plus, Yahoo's service doesn't offer its own debit card, so you can forget about instant access to your funds.
Generous limits will cost ya
PayDirect's fund-transferring process is identical to PayPal's, except that it works only within the United States. When you send money, PayDirect debits your credit card (MasterCard, Visa, Discover, or American Express) or your checking or savings account. Next, it sends e-mail to the recipient notifying him or her of the transaction. Need to transfer tons of money? PayDirect's sending and receiving limits are much more generous than those of PayPal. PayDirect lets you send as much as $1,000 per month and receive $10,000 each six months. But you'll pay for the high limit. Unlike PayPal, PayDirect charges for every transaction no matter how you fund it; each payment costs 30 cents, plus 2.5 percent of the amount. High-volume sellers who have received more than $2,000 in PayDirect payments in three consecutive months qualify for the Preferred rate, which is 30 cents plus 2.2 percent of the amount. The sender decides whether he or the recipient will pay the fee, but there's no free ride.
Only one way to get to your dough
Like all payment services, PayDirect sends recipients e-mail with a link that lets them claim their funds, and receivers need to sign up with the service, too. When a recipient gets the money, it's immediately dropped into the PayDirect account. However, if your rich buddy wants to spend the money in the real world, he or she must transfer it to a checking or savings account, a process that takes approximately seven business days. PayDirect no longer lets you transfer money to a credit card account, as it did last year. Unlike PayPal, there's no paper check option.
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