What is Overnight Investment Float Profit
Summary: The discussion revolves around the concept of overnight investment float profit, specifically how large companies like eBay might benefit from holding seller funds in transit to earn interest. thief_in_the_night_100_rating_seller initiated the conversation by pointing out the financial gains companies could realize through temporary investments. onlinecentral provided a hypothetical interest calculation, while pickapaper shared a similar experience from working in a bank. Other participants discussed the balance between corporate financial practices and customer service, noting that financial holds can protect both buyers and sellers. The conversation also touched on humor and exchanges about similar past topics.
Overnight Investment Float Profit
From a purely corporate financial standpoint, holding vast sums of seller money in limbo generates massive interest income. While funds are marked as "In Progress" or "Held," the money sits in eBay’s aggregated corporate accounts. They can invest these massive pools of cash overnight into low-risk, short-term instruments (like repurchase agreements), earning interest on your money before it finally lands in your bank account.
ebay would never!
onefootflipper
·1 week agoI think everyone understands this. All financial institutions make money on the float.
They might hold your money a lot longer because it seems like people keep either returning or cancelling your items. You seem to somehow sell the exact same used items multiple times with the same photos.
The amount of money they make on the float on your money is meaningless compared to what you pay in fees. If you sell an item for $100 shipped then you pay $13 in ebay fees. If you don't get paid for a week then they also made 6 cents on the float.
I have a long track record and get daily payouts so my float time is more like 2 days. On my $80K in annual payouts that adds up to all of $13.15 cents per year. A meaningless number compared to $80,000.
mam98031
·1 week agoWe are a society that believes and practices capitalism. What you state is true and has been something that many corporations of all kinds have done for 100's of years.
The thing to remember for this site specifically, there are good reasons for holding funds. They serve a purpose and not to make more money for Ebay but to protect buyers and sellers alike. There was a time, before Ebay handled the money, that sellers would come here, sell as much stuff as they could, get paid for it [likely through PayPal], then take off with the money just before it became clear to buyers and Ebay that the seller wasn't shipping. Many buyers as well as Ebay got burnt by these actions. The current rules, prevent that from ever happening again. That is a good thing.
I can't tell you how many times I was on a thread with a newer seller that got their money, spent it, then the buyer wanted to return it and the seller had no money in which to process the refund to the buyer. That use to happen a great deal. No so much anymore.
Rules have reasons. We may not always agree with them, but there is a reason and usually a good one.
aeparts1
·1 week agoThanks for stopping by to let us know.
funfactorychannel
·1 week agoIs this your fifth complaint?
We can only control the cards we have. The issue isn't really an issue
squinkercat59
·1 week agoIt's like dealing with any retail - they take your money out of your account or charge your card immediately, but when you make a return, it takes them a week or more to return it to you.
vintage-camerastuff
·1 week agoI can do the same thing with all my money and make an extra 39 cents a day.
chapeau-noir
·1 week agoThat's gonna burn a hole through your pocket.
pickapaper
·1 week ago · EditedThis is nothing new. When I worked at a bank back in the 70s, part of my job was to look at the cash flow and determine how much to invest in temporary instruments to earn extra interest. This was done every day.
thief_in_the_night_100_rating_seller
OP1 week agoWe're Twins.
gurlcat
·1 week agoThis OP makes me wish so bad that more archival content from the old forum was available to point to. @thief_in_the_night_100_rating_seller you are certainly a master of bringing up topics that have been discussed to death already. Your name should be dead_horse_beater
chapeau-noir
·1 week agoTruth.
Maybe it's the long summer, but people are craaaaaankeeee.
gurlcat
·1 week ago · EditedThis one does feel extra long.
EDIT: That's what she said.
thief_in_the_night_100_rating_seller
OP1 week agoSave it for the birds.
gurlcat
·1 week agothe ...... birds?
bennotbill
·1 week ago · Edited"This one does feel extra long."
Isn’t that one of those what the actress said to the Bishop jokes.
onlinecentral
·1 week agoThe Prime Rate was 3.25% in a discussion from year 2020.
A million dollars at 3.25% annual interest would be $32,500 a year.
Divide the $32,500 by 365 and you get $89.04 per day.
A million dollars of sales per day would be $100,000 in FVFs per day.
A million dollars of sales per day would be $36,500,000 in FVFs per year.
thief_in_the_night_100_rating_seller
OP1 week agoGreed.