Using Paypal On eBay
A Buyer's Review
Paypal is the preferred payment choice for many buyers because Paypal allows buyers to pay instantly for eBay purchases. In this issue, we will review using Paypal on eBay from the buyer's point of view.
For the seller's point of view see: eBay Seller's Guide To Paypal.
Before we get started, a word of warning about Paypal scams.
There are many Paypal scams. Always make sure you are logging into the https://www.paypal.com when you visit your account. Do not click on links within emails. See my spoofs and phishing article for more information about avoiding these scams. Paypal spoofs are quite common.
Using Paypal for eBay Auction Purchases
Since eBay purchased Paypal, it has become even easier for buyers and sellers to complete auction sales. Buyer's like paypal because they can quickly and easily pay for eBay purchases online.
Some bidders will only bid on items they can pay for with Paypal. These bidders review the auction listing looking for the Paypal logo. If they do not see the Paypal logo, they move on without bidding.
One thing that confuses buyers is some sellers accept Paypal payments through credit cards, while others only accept transfers. You see, with Paypal a buyer can fund the transaction in three ways. This can confuse buyers. And cause problems for both the buyer and the seller.Here's the three ways to fund a Paypal transaction:
The first two options cost Paypal nothing in processing fees. Credit cards cost about 2 percent to process, and Paypal passes this on to merchants. Some eBay sellers do not want to pay this fee for service, so they only accept payments by transfer. This confuses buyers who win auctions and assume a credit card transaction is fine.
Paypal wants users to transfer funds, and not use their credit cards. Not only is this cheaper for Paypal, but there is no risk of a chargeback.
A chargeback is when a buyer reverses the charge on a credit card by contacting his bank. Most, maybe all, banks will reverse a credit card charge with little or no investigation if the card holder contests the charge. The money is taken right out of the merchant's bank account -Paypal in this case.
Paypal makes it difficult to use a credit card to send money through Paypal. This is done making the credit card payment option difficult to find, and warning users about the "risk" because you cannot buy Paypal's insurance.
With a credit card purchase, you do not need Paypal's insurance. Your bank will reverse the charge free if the seller scams you.
One other way Paypal makes it hard for users to instantly send money with a credit card is by limiting the total amount you can charge.
The first time I tried to use Paypal to pay for an eBay auction, I was unable to use my credit card because the amount was above the limit. That was a $700 item. I think the single item limit is $500, but could not find confirmation of this. The lifetime limit, or total amount you can send all eBay sellers with a credit card is $2,000.
If you wish to pay for an item with a credit card through Paypal you should confirm the seller takes card transactions. This can be done reviewing the auction and looking for the credit card logos adjacent to the Paypal logo in the payment methods screen.Look for this group of images just above the bid area:
Whenever you pay for an eBay auction through Paypal, you should check the seller's Paypal status. Do not send large amounts to unverified users, and watch that the user's address matches the auction details.
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