I buy a lot on eBay. Are any payment methods more secure than others?
Yes. But before discussing secure ways to pay, it’s best to highlight how not to pay for an item on eBay. If a seller ever asks you to pay with a money order or a cashier’s check, beware! Once that payment leaves your wallet, it becomes extremely difficult to retrieve. In this instance, your investment is as safe as if you had handed a wad of bills to a trench-coat-wearing Rolex vendor.
Another reason that cash or cash wire transfers are generally not the preferred payment method is, if you pay by cash, you are not granted protection under the eBay Standard Purchase Protection Program. You also lack any proof of your payment, and will have virtually no recourse should the deal turn out bad.
eBay’s Standard Purchase Protection Program compensates buyers for qualified dealings. There are two situations when a buyer may be compensated. The first is when an item was purchased on eBay, but never received by the buyer. The second is when the item obtained was considerably different from what was described. A very important thing to keep in mind is that eBay will not cover transactions that exceed $200, and they charge $25 for processing the claim.
Because eBay’s protection is limited, a savvy shopper will consider other payment methods that afford more protection to your transactions. Your credit card agreement may offer the security you seek. It could be a good place to start when involved in a sketchy transaction with that Louis Vuitton boutique from Shanghai.
By using a credit card, you have the option to contest a transaction through the credit card company, but it is left to their discretion whether to void the sale or not. Despite the fact that your credit card offers some protection, you must use your common sense when deciding when to release your information. The fewer people that you provide your credit card number to, the safer you are from credit or identity theft.
eBay recommends that you make all your transactions through their partner company, PayPal.
To learn about the ins and outs of paying via PayPal, and why eBay considers it your safest payment option, be sure to read next week’s column.
This article appears in July 29 • 2005.