I've just recently (last week) gone through a paypal "limitation" so i know a little about the worse they can throw at you... this is what happened...
Day 1
I receive an email from paypal saying that my account had potentially been hacked - all transactions are put on hold and i cannot send money
Day 2
I open my paypal account to find that i need to re-enter various account details, password changes etc and one seller complains that he hasn't got his money
Day 3
After completing all the requirements i now find (through telephone conversation) that i have to send them proof of address, so i scanned a household bill and got frustrated because there file size limit is 1mb - my pic was 1.1mb - i managed to reduce it
Day 4-5
After 3 emails and numerous phone calls they finally review my account and remove account limitation
Day 6-9
After further telephone calls i manage to get the transaction limitations removed and these funds are now released to the sellers
What pi**ed me off was that my password was 15 digits and my account appeared to have no unauthorised access whatsoever. So it seem they where just after more info......why couldn't they just ask for it?
If i was less persistent it probably would have took weeks to resolve
After looking on the internet this sort of stuff seems to happen a lot.... luckily i only use it now and again, but it could trash a small business for peeps who do ebay etc...
So back to the thread question
An online payment system i feel is needed because they are very convenient, modern and what peeps use online!
Paypal...... better than nothing
Google checkout.........yes please