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PayPal users stranded as site glitch continues

Ebay transactions could be delayed

A routine monthly code update performed on Friday for the PayPal.com online payment website has caused havoc for users, many of whom have managed to access the site only intermittently since the changes were made.

In an update posted Tuesday on eBay.com, which owns PayPal, PayPal said the problems were apparently caused by the new code base, which was meant to update the site on Friday.

"The code worked well when tested and during the first hours of launch," the statement said. "Unfortunately, problems handling peak levels of traffic developed later in the day that created intermittent availability and errors for members. These problems have continued in varying degrees."

Sara Bettencourt, a spokeswoman for PayPal, said that the company doesn't know how many users have been affected by the service disruption but that it doesn't believe all of its customers were experiencing problems.

"From what we've heard, some people have been able to access their accounts," she said. "We don't have any ways to assess the numbers." Some users are experiencing slow access, while others are unable to reach the site, she added.

PayPal and eBay technical support personnel have been working around the clock since Friday to try to resolve the problems, but there is no time frame for when repairs will be made, Bettencourt said.

The type of coding error is not being disclosed, nor would Bettencourt comment on which software language the code uses.

PayPal.com has about 50m user accounts, including about 15.5m that are active, she said.

Asked why the site hasn't chosen to roll back the update to when the software was working properly, Bettencourt said that it would be a complex process and that the technicians are instead focused on repairing the problem.

In its statement, PayPal said that "account data and personal information have not been compromised by these issues."

The company apologised to buyers and sellers who were unable to complete their payment transactions over the weekend.

"We understand the PayPal site issues may be impacting many of you and your ability to do business with PayPal on and off eBay, and we apologize for this situation," the statement said.

A Virginia-based eBay seller, who asked that his name not be used, said he wasn't sure whether the PayPal.com glitches reduced his sales over the weekend. But he noted that the upgrade problems are reminiscent of frustrating glitches he has experienced with eBay.com site changes that were touted as "improvements".

"EBay would change formats on the site and had the same problem," with users having difficulty logging in and making purchases, he said. "Development people always want to bring out new versions when the existing version is fine."

The problem with eBay.com's updates, he said, is that they don't appear to have been tested enough before being deployed. "That's what it really comes down to; they don't have it debugged," he said. "There have been some features (on the eBay site) in the last six months that I've been pleased to see, but I don't think they have the methods in place to do it seamlessly."

The seller, who has logged more than 5,000 sales on eBay in the past six years and conducted more than 2,500 PayPal transactions in the past three years, said he has never before had problems logging into or using his PayPal account.

Michael Dortch, an analyst with Robert Frances Group, said the PayPal glitch will certainly raise questions for users.

"PayPal's multi-day inaccessibility may not have meant much so far in the grand scheme of things, or even to the still-nascent online financial services industry as a whole," Dortch said.

"After all, PayPal isn't ING Direct or Wells Fargo – yet. However, for those eBay power buyers and sellers and others who rely upon it, any outage is disturbing, and one of several days would perhaps already have been fatal to a company without the support of an eBay.

"PayPal has got to get this resolved, and reassure its constituents that it's unlikely to happen again, to avoid opening itself up to intensified competition and user reluctance," he said.


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