Perfect Money VS Liberty Reserve. Which one is the better?

A choice is the criterion of the freedom. The wider the choice is the more freedom an individual has. But the ability to make your choice does not mean that you are a mature person. On the contrary it is your decision and its implications that should be taken as an index of your wisdom and sense. But our article is not about philosophical aspects of choice and freedom. We are talking about the world of electronic currencies. Today when there are multiple payment processing services on the Internet the choice becomes rather complicated and it is hard to decide in what direction we should go. That is why we decided to discuss here two relatively large payment processors and present you a comparative analysis of Perfect Money and Liberty Reserve which as we hope will help you to make wise and reasonable decision in the future and thus show how much right is your choice.

Interface

Perfect Money developing in line with its commitment to the international expansion doesn't cease offering more and more language options to its users which, in our humble opinion, is a good method to attract customers who wish to use a payment service capable to work with them in their own easy to understand idiom. Today Perfect Money provides account holders with a choice of 16 languages and in addition to this we should underline peculiar style featuring each of the language interfaces which is also an additional credit to the designing facilities of PM team. This is not the case with Liberty Reserve and you needn't to be a biased and partial to understand that when it comes to design and interface PM has significant advantages over LR.

While Liberty Reserve covers fundamentals of the service usage in the FAQ section Perfect Money offers a number of choices to master basic skills of how to manage the system including "Tour" and "Help" sections both featuring animated flash reels where customers are provided with graphical illustration of where they need to click or press and what they should enter in a certain blank field. And it should be noted that these sections are included in addition to the traditional FAQ which is also accessible on the PM site.

System functions

Adding funds:

Funds withdrawal:

In a member area of Liberty Reserve we can find no section at least remotely resembling such functions as "Deposit", "Fund your account", or "Withdraw" at all. A new person who doesn't know all the fine points of LR will have to render to the FAQ section where they can learn that in order to enter funds into the system one needs to work with electronic currency exchangers. These exchangers are the only possible and thinkable way both to deposit and withdraw money from Liberty Reserve accounts. Thus, in the course of FAQ research we learn that there is "Buy/Sell LR" function within our member profile which is specifically meant for funding our account or cashing our money out of LR. Perfect Money in turn offers a range of methods both to load money and withdraw funds including bank wire, e-voucher, e-currency, prepaid card (for withdrawal only) and exchange partners. We should point to that Perfect Money unlike LR offers "Bank wire" both for funds deposit and withdrawal. It means that PM is open to accounting and there are ways to trace your transaction while LR evaded such kind of control and entrusted all the troubles of transacting with its users on exchangers which allows it to easily exploit this circumstance as an argument if any accident resulting in money losses occurs.

Interestingly, while Liberty Reserve itself encourages users to render to exchange services it at the same time disclaims any liability. If you enter the "Exchangers" section you will encounter such promotional passage:

In order to add or remove funds from your LR account you should use one of the independent exchange providers from the list below. Please note that businesses listed on this page are independent and in no way related to Liberty Reserve, and Liberty Reserve does not guarantee any outcome that you may experience with these companies.

The benefits of having independent exchange companies are:

you can find an exchanger that speaks your language!

you can use an exchanger that is in your city or in your country!

you can always find an exchanger with the funding method you prefer (bank wires, credit cards, Western Union, mailed in money orders and checks, local cash deposits, ...)

competition always results in a better service and lower fees!

Rather strange. How can two opposite things co-exist at Liberty Reserve? On one hand you have no other way to transfer money to and from your LR account as via exchangers and Liberty Reserve itself lauds their advantages, on the other hand it says "Exchange providers are not affiliated with Liberty Reserve and your dealings with them are at your own risk." Furthermore, in the FAQ section it also adds: "We recommend that you only use exchange providers that are members of the Global Digital Currencies Association." What is notable here is that there are some exchangers approved by the association which do not want to partner with Liberty Reserve who in turn also does not want to partner with them calling such exchangers as scam.

Internal transfers

Both Perfect Money and LR have their advantages when it comes to charging fees for various operations with the accounts. On one hand LR's 1% commission for receiving funds within the system is very fair and rather inexpensive inasmuch as irrespective of the amount you receive the fee never exceeds a $2.99 level. On the other hand while Perfect Money charges 0.5% for all initial transfers and hence the total commission can exceed LR's $2.99 still the fee is very fair and reasonable inasmuch as this fee is a source of additional funds needed to support, maintain and upgrade the payment system itself. When PM introduced this fee at the end of March it explained:

Building a successful policy of growth and development Perfect Money payment system tries not only to offer its clients the innovative opportunities and state-of-art tools to work with the electronic finances on the Internet but also to create a firm basis for Perfect Money system which includes a 100% liquidity of the system and a professional team of talented managers. However the geography of Perfect Money is constantly expanding and today the analysts of our company came to conclusion that no fees for internal transactions slow down the development of new technologies which Perfect Money is going to implement... Introduction of fees was a serious step for us. Hereupon we became more attentive to the quality of our service and to the heightening of quality standards of Perfect Money...

Conclusions suggest themselves: Perfect Money uses the best commission plan when it comes to internal transfers because: first, the fee is comparatively small and second is that the commission revenue is used to improve the service. Liberty Reserve offers rather cheap fee schedule but the service offered to the customers perfectly fits the price respectively.

Currency exchange:

Perfect Money offers its users to exchange any of the currencies within their account (USD, EUR or Gold) at PM's exchange rates which are, by the way, always lower than current market rates. In order to help customers compare the rates and make sure that those offered by PM are better than those at the world markets there is a dedicated column entitled World Market Rates, which can be found both in "Currency exchange" section and "Analytics" section. LR offers no internal exchanges and again it entrusted this work to exchangers. Seems as Liberty Reserve actually makes just half of the work that is due to a payment system.

Internal mail:

Perfect Money provides no option to customers to communicate within the system with each other while Liberty Reserve does. Still, PM offers an innovative option to send SMS messages from within your account to any telephone number across the globe for just $0.01 per one message. While sending an inquiry to LR's Customer Support you receive an answer to your email address, PM allows to receive responses from its Customer Support right to your PM account which is an additional convenience.

Summarizing all what was mentioned above we can say that Perfect Money again has more advantages than Liberty Reserve. An intelligent and scrupulous customer will notice that Perfect Money offers more functionality and diversity of services as compared to Liberty Reserve the only plus of which is its 1% fee. But as we already mentioned above the service is worth the commission paid. Here we should also mention one more additional service available within PM accounts - Analytics section. Using this informational resource customers can get the latest reports on the Markets' developments and events, and besides, one can learn about the profits gained by PM users when exchanging one currency for the other. The convenience of this informational resource is that the latest reports from currency markets come right to the user's account. PM really cares for its consumers and doesn't try to get rid of any liability as it is the case with Liberty Reserve where a good few of the services are rendered by the third parties instead of the payment processor itself. 

Security

Security is an important factor influencing customers' choice as no one wants their money to be lost or stolen. Perfect Money offers a wide range of tools to protect customers' accounts from being compromised which in addition to secure SSL encrypted connection includes Identity check, SMS authentication, Code card and IP control system.

"Identity Check" - By using this tool each time that a user is logging in from different PC or web-browser, an email is sent to his/her email box to check the user's Identity. This email contains a confirmation code, which should be entered.

"SMS Login" - Enabling the SMS login security tool allows a user to receive short message right on their mobile phone, which contains the security code for accessing to the Member Area when the user logs in.

"Code Card" - The system can provide a user with a graphical Code Card with secret numbers. An account holder is asked to enter secret number each time he/she tries to do something important, for example transfer funds, or change security settings. The Code Card is an image that can be saved or printed on any Computer.

API interface - by enabling IP control you can protect your account from being accessed from other IP addresses than specified.

Liberty Reserve also provides their customers with SSL encrypted connection but it offers no additional tools to make the login procedure more secure. The only protection measure is a four step login procedure. First you enter your account number and password, then you confirm your Greetings page and the system directs you to your LR wallet which is not your main account. If you want to access your main account you need to enter a PIN code. No IP confirmation or SMS authorization is available with LR.

You needn't love Perfect Money to realize that Liberty Reserve again loses to its rival in what relates to security measures. While PM offers four different tools which you can enable separately or simultaneously LR can offer you just an option of confirming your greetings and entering your PIN code. The first tool is more than ridiculous as long as any robber will confirm your greetings with great pleasure. This measure cannot be even ranked as a security.

DDoS experience

Certainly when making our comparative analysis we couldn't avoid speaking about the reputation of each of the two payment services as long as it is a good name which contributes more to customers' trust to any company. Within the whole period of its existence Perfect Money proved to be a reliable and stainless electronic currency service. We have never heard of any account blockages or long downtimes as a result of heavy DDoS attacks on the company site. No discreditable information ever appeared either on the virtual space or in official print media about the founders and managers of PM. All these cannot be said about Liberty Reserve. The very inception of the company is related to scandalous persons like Arthur Budovsky and Vladimir Katz who were indicted by the U.S. prosecutors and charged with running financial fraudulent schemes. Besides, within just six months of the previous year Liberty Reserve underwent three DDoS attacks which is too much for the given period. In February this year the system was unavailable six times and the last one took long which made many customers of LR go into panic. Finally it was found that the system's API was hacked but the company has been persistently denying the fact calling all the claims as some rival's efforts to discredit the service. A great number of account holders lost their money without any opportunity to refund them. The only thing Liberty Reserve could say was that customers need to be more cautious as long as their accounts were hacked in the course of phishing attacks which means that it was users' carelessness that led to the incident. But the explanation seems lame as long as among those users whose accounts were hacked there are some exchange partners and other businesses who have been working in the ecommerce market for a long time and that means they could be fooled by phishing mail.

Feedback

Both LR and PM receive positive and negative feedback on their activity. But while those few users who express their dissatisfaction with Perfect Money speak about services and commissions that do not suit them those numerous customers aggressively attacking Liberty Reserve speak about serious problems related to security and customer service. It should be noted that some respectable and reputed business customers expressed their disappointment with Liberty Reserve in light of the recent accident that resulted in $1 million losses from LR accounts, as reported on Wikipedia web site. LR's behavior in such conditions showed an outrageous disrespect to the best business practice and ethics inasmuch as calling its clients as scammers instead of trying to resolve the issue that arose doesn't adds credit to it.

Transparency

In the "Contact us" section Perfect Money provides all necessary corporate data including its registered address and license information. Liberty Reserve on the contrary conceals all the corporate information. Interestingly, just a few weeks ago in the "Corporate" section one could find a thorough information about LR's geographical location, company members and even pictures of its Costa Rica offices. The company seemed to unnaturally demonstrate its legality. But as soon as some former users decided to file a lawsuit against the serivice LR unexpectedly removed all the corporate data and provided one more lame explanation as it usually does:

Please note that corporate information has been removed, based on the legal advise from our attorney, to comply with the strict Costa Rican bank secrecy laws. It is available upon request under the proper order.

As you can see Liberty Reserve is more and more plunging into the shade. First, it removed all other deposit and withdrawal options except exchanging partners, then it disappeared from the web for a portion of time and now it removed company information. Nothing resembling best traditions of transparency and openness.

Conclusion

In our analysis we studied all the aspects of each of the payment systems. Granted, Liberty Reserve is a payment service with years of industry experience which in some cases inspires some respect and trust to it. But LR’s days have gone, it is getting more and more old-fashioned and obsolete. Today a great number of people do not trust Liberty Reserve as long as they fear to be defrauded as it was the case with many other ex-users of LR. Perfect Money is a result of payment services evolution, it is the latest word at the market of electronic payment systems. While Liberty Reserve may only be proud of its history the system itself is getting more and more just a matter of the past. Its spoilt name and compromised reputation along with scarce functional cannot serve as a firm and reliable basis for the future. The system just allows its users to send money while they cannot withdraw their own funds which means that this e-currency is non-existent. It is up to a user to decide what is better for them but the only way to evaluate any service is experience. It is your experience of working with PM and LR that will suggest you right conclusions. Only after using the services offered by both of these payment systems you can make sure which one is more convenient, secure and profitable.