eBay/Paypal, how to get started, things to know and their evil side..

eBay Inc. is an American Internet company that manages eBay.com, an online auction and shopping website in which people and businesses buy and sell a broad variety of goods and services worldwide. Founded in 1995, eBay is one of the notable success stories of the dot-com bubble; it is now a multi-billion dollar business with operations localized in over thirty countries. eBay expanded from its original “set-time” auction format to include “Buy It Now” standard shopping; shopping by UPC, ISBN, or other kind of SKU, online classified advertisements (via Kijiji or ebay Classifieds); online event ticket trading (via StubHub); online money transfers (via PayPal) and other services.

If you want to buy a product from this shopping website you have to be a member. If not already you have to register, which is very easy. After registering you have to link your paypal account with your ebay account. A paypal account is like an online bank account, you register in the same way as ebay and after following some credit checks you are asked to link your bank account and debit card for verifiaction purposes.

To add a bank account you press on the “profile” tab and then on the subtab “Add a bank account”, there you are asked to provide your bank’s branch name, bank account and sort code. After confirming all the above details paypal sents two small deposits under £1 to your bank account in a period of 3 days. What you have to do to confirm that you own the bank account is simply check your statement for these two small deposits. Once they are there you are asked by paypal to provide these two small deposits in the system to get verified.

In a very similar way you can link your debit/credit card with paypal. This time an amount of £1 is charged to your card with a 4 digit code which again you have to provide in the system. You can also verify your address by receiving an automated call from paypal to your landline number. You will be given a four digit code which you have to enter to the paypal account for the final step of verification.

These may sound like a lot of things to do but actually the steps are very simple. You may think that is a bit too much in order to buy something from ebay but actually doing all these steps provides security to both buyer and seller in the case that something goes wrong.

Most ebay sellers recommend paypal as a method of payment because it is fast and the seller gets his money immediately. Other payment methods may be accepted depending on the seller but they take more time and effort to complete the transactions.

If a buyer is interested in a specific product from ebay, he/she can simply use the “buy it now” option for the item, complete the payment process and wait for the item to arrive. He can also bid on a product if it is an online austion. The last bidder with the higher bid wins the product. If more details are needed on behalf of the buyer he/she can contact the seller by sending him an email through the website or by phone if a number is provided.

Now in the case that you receive the product and is not as described there are a couple of things that the buyer can do. First he/she can contact the seller explaining the situation. If the seller responds he may ask you to return back the item to be replaced or you may be given a refund. That is not always the case. A seller may not respond and if you have paid a lot of money for something then you have to find your way out of this. Giving negative feedback to the seller which is not good for his reputation is one thing but you still have to get your money back. Paypal is the solution for this. To not complicate things you have to do a few steps with Paypal and open a “dispute” for the specific item. The seller will be contacted by paypal and they will try to resolve the issue for you. In the case that you win the dispute you will get your money back from paypal, requiring that you completed the payment through Paypal and not anything else.

When buying from sellers on ebay is always good to check their seller profile for feedback and rescent transactions. Top rated sellers are recommended and you will see that they have thousands of transactions with good positive feedback. A seller moves his way up the selling ladder by getting stars according to his sales, at the beginning a yellow star is given to the seller, as sales increase the yellow turns into blue and so on. The higher distinction is to become a top-rated seller.

It is good to note that ebay is not only for buying, you can also sell your personal or unwanted items. Be carefull not to over do it though because there is a limit on the items you can sell under each category and if you exceed those limits some really frustrating restrictions may come your way either from ebay in the form of not being able to sell in a particular category for a month or from paypal in the form of limitations. By limitations we mean that paypal performs checks on the rescent sales that you have made and is asking for explanations of where you found the items and so on. It may also ask for suppliers details and contact information and in the case that you are selling your own stuff may be frustrating because you have no such information and you may get your paypal account limited for that.

In a few words if your paypal account becomes limited and you can not restore it back to a full working order then it will stay limited forever and any money in the paypal balance will be available to withdraw after 180 days from the day the account was limited. Paypal says that this is done to minimise fraud and make ebay a safe buying and selling community.

Obviously there is a lot more besides buying on ebay and most people are not aware of them, especially when paypal gets in the way leaving many people frustrated and angry.

References:

http://www.paypalsucks.com/

http://forums.ebay.com/db1/topic/New-To-Ebay/Here-Is-Why/510009566

http://www.aboutpaypal.org/ebay_problems

http://www.phantomgorilla.com/blog/2009/07/15/ebays-fraud-problem/

http://www.aboutpaypal.org/beware_of_paypal

http://www.paypalwarning.com/paypal_sucks

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11 Responses to eBay/Paypal, how to get started, things to know and their evil side..

  1. adriankth says:

    Regarding the rating system on ebay, what do you think of the effects of Fake ratings and comments?

    Most ratings I see on ebay are around 98% postive to 100% positive. If a seller’s rating drop below a certain number, they could just create a new account and get some fake ratings on it. Due to this, people who are just starting out as sellers will have problems getting their stuff sold such and have use a lower price model. However, I think it is ‘impossible’ to get 10000 fake ratings unless they really do invest a lot of time into it. So I still find it reliable.

    There is also an issue of open disputes on return items. http://community.ebay.co.uk/question/Buying-Ebay/Like-Return-Item/1900034026 . There appear to exist ‘customers’ using this type of claims to temporary use an item and then return it later, thus putting sellers at a disadvantage as they could not list their item as new now.

    Overall I really like the post as this sets out a general guide to avoid certain conflicts that happens in ebay. And regarding the seller’s limitation and verifcation process, its really nice to know that!

    • andreaskrs says:

      Leaving fake ratings and feedback is not as simple as it sounds, in order to leave feedbkack fake or real you have to purchase an item. When purchasing the item the sellier is charged automatically the basic ebay fees on the selling price which is around 10%. Even if some people work together in order to raise someones feedback the seller still has to send back cancelation requests for the items “bought”(actually not bought as they were only to raise the feedback) in order not to be charged the selling fees which he is forced to pay. So a considerable number of cancelation requests will lead to other problems so it is very limited the amount of fake feedback on a seller account.
      Also a buyer is able to leave either positive neutral or negative feedback, and its up to him/her depending of the overall transaction of what he may decide to write. A seller can only leave positive feedback, nothing else.
      Hope this answers your query

  2. nathancscw says:

    Paypal is being used as a political tool in Zimbabwe, the service is not available there for reasons associated with targeted sanctions on Zimbabwe. This is rather controversial application of international law as the sanctions on that country are suppose to target individual leaders and not the whole country.

    Besides I also agree that the whole process leading to purchase and delivery of products can be very frustrating especially when you have never ordered any items from ebay before. I think perhaps more innovative payment methods need to be invented that will eliminate the process of registration by perhaps using an registered i.p purchase system.

    • andreaskrs says:

      About your last point, ebay and paypal have one of the most sophisticated computer systems, if your ebay or paypal account becomes limited or suspended and you try to create another one with the same electronic device then immediately the ip address is recongnised and the new accounts are limited immediately as well! there have been huge advances in this area on the last year and paypal has become a lot stricter making transactions safer and safer all the time. Also if you think that you can create another paypal or ebay account from another device then after a little reasearch your accounts will be limited again as your address or telephone number will be recognised by the system. Even if you manage to create a completely not connected account from your initial one after a couple of transactions the system of paypal will automatically limit your account and will ask for additional information regarding your sales, and when that happens you can not do anything, paypal is trying to keep only the big sellers on ebay thus removing the ability from individual people to sell

  3. stephengnanda says:

    Wonderful topic, Ebay is a massive platform. Very interesting topic with some useful point however, it seems that the blog has been based on personal experience which is good but what other said. Any academics researches or quotes to support arguments will be welcomed.
    Good references and easy to access

  4. katka555 says:

    You have fully decribed functionality and option which is ebay offering. I personaly never tried to sell anything through them, however i use Ebay fairly often to get some items. Would you say E-bay is offering enough protection for buyers (and sellers) not to be victim of scam?
    I still think there is certain unsecurity using ebay against for example Amazon, especially buying from private seller not company. My concern is, when the item get lost in post. What options private seller has? One and only item, so no option to send the replacement one. Returning money? I think that can be a proccess taking weeks. And than end of the day buyer is the one on loosing site.

    • andreaskrs says:

      Security for both sellers and buyers is provided with paypal, once you buy something a record of the transaction is stored on paypal as you make the payment through it and if anything goes wrong you can open a dispute and get your money back. if the item is lost through the delivery by the post office then there is a form you can fill in at the post office that the item that you sent is lost and you can claim your money back. there is a solution for everything! i bought a usb from ebay that never arrived and informed the seller, he told me that he will replace it and make a claim for it at the post office, hope this answers your questions!

  5. martinlee7 says:

    I have not used ebay for a long time but when I did I found that I didn’t really use the feedback tool. Feedback is an optional tool as far as I know; so do you feel that sellers do not necessarily always get the right feedback that they deserve and so force them to gain ‘fake’ feedback in order to push up their ratings. I have looked over the ebay forums and found many people complaining about their lack of feedback. For example: http://community.ebay.co.uk/question/Selling-Ebay/Sellers-Leaving-Feedback/900123807?&. Good article though, well informative!

    • andreaskrs says:

      There are many situations regarding feedback from sellers. For instance large sellers have their ebay profiles to leave automatically feedback once a payment has been received, others require the buyer to leave feedback first once the item is received and then they leave feedback to the buyer. Most of the times they do that to be sure that they do not leave positive feedback to a buyer and then the buyer ignores or forgets to leave feedback to them. in a way a buyer is tight to leave feedback in order to receive one, but this depends on the seller. there is also another situation where a seller will not leave feedback until he receives one in order to be see if the feedback left is positive or not, in other words he does not want to leave positive feedback and then receive a negative one. yes feedback is optional but is always good to leave one once you are satisfied with the item you purchase because sellers build up their reputation from it. i hope this answers your questions.

  6. cscwblog2011 says:

    A very informative blog on how Ebay works, this would be a very useful blog for a beginner who is interested in setting up an account. Reflecting on my own personal experience of buying and selling on Ebay, the process seems to be a little long-winded when it comes to processing transactions. I understand that this is for security purposes but I feel that once your Paypal and Ebay account has been linked together initially, you shouldn’t have to go through so many steps each time and should be able to use a similar feature such as Amazon’s ‘one-click’ so that the time to buy an item is reduced.

    It would have been interesting to hear more about Ebay in terms of its success in recent years (has this declined or increased at all?), how Ebay compares to its competitors and what it is about Ebay that makes it the most common online auction site on the internet today.

    • andreaskrs says:

      eBay is probably the largest shopping website at the moment with different versions suitable for each country and has been one of the fastest growing companies. More and more power sellers are advertising their products on ebay such as Debenhams, Next, Argos, Tesco outlet etc. Ebay offers the wider choice of products available from the smallest item like a collectible coin to a helicopter or a boat. it is the security that is provided together with PayPal that induces most people to buy from eBay compared to any other shopping website. Amazon is its closest rival but i personally prefer eBay unless i need a book then i use Amazon. Not sure but i dont know how safe it is when you are paying with your debit/credit card on Amazon!!

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