eBay auction listings can demand payment in a dizzying variety of forms, but not all payment systems are created equal. As a buyer, you should know what each type of payment means for you. As a seller, you should be aware of the ways in which buyers will see such terms.
The single most important fact to understand about auction payments is that credit cards, whether through PayPal or through some other clearing agent, are the ideal way to buy and sell online. Many consumers have an innate fear of credit cards as "less safe" than checks or money orders, but for several reasons, credit cards are much safer today than other options:
- Buyer protection. All of the major credit cards offer buyer protection in some form or another. If you do not receive an item for which you've paid, or you're not satisfied with a purchase, you can "dispute" the charge by contacting your credit card company and having the payment reversed. Checks and money orders do not offer this protection.
- Seller protection. Unlike printed checks or money orders, credit card payments provide a basic guarantee that funds are actually present. Once you have authorized a charge, whether through PayPal or some other agent, you can reasonably expect to receive payment if you deliver the goods.
- The emergence of e-checks. The relative safety of checks as a "printed and signed only" form of payment has disappeared. These days nearly every major bank will accept "e-checks" drawn against a customer's account. For such a check, no signature or printed material is required—just a bank account number and routing number, both of which appear on a check. And e-checks do not offer buyer and fraud protection like credit cards do—all responsibility in the case of e-checks rests with the buyer, caveat emptor.
For these reasons, a general guideline is to buy with a credit card whenever possible. To put this guideline into practice, however, it's helpful to understand some of the jargon associated with payments in eBay auctions. Read on for a rough guide.