Using a credit card as PayPal funds source

VictorMeldew

Hi all, I've been buying and selling on ebay for a few years now using my PayPal account backed up with my current account. I read on MSE somewhere that its safer to use a PayPal account backed up with a credit card because then I'd have the added protection provided by my credit card company.

I've recently been trying to change things around on my PayPal account but have got stuck. I first tried to set my credit card as a primary source for funds, but had to first apply for 'extended spending limit' or something which I have done.

So now I have both my credit card and my bank account set as a primary source for funds. Should I now just delete my bank account? When I try and do this, it comes up with a warning saying that I will no longer be able to do direct bank transfers etc and if I ever want to register the account again, will have to go through the whole authentication process again.

What happens if I just go ahead and delete the account anyway? Will I still be able to buy on ebay using my PayPal account? Is there a better way of doing this? Cheers for any advice.

valiant

You're mostly right. Paying by credit card offers more protection.

Leave your bank account details on there. Paypal maybe sharks but they're trustworthy sharks with a semblence of a reputation to look after; so there's no real advantage in removing the account....and, actually I don't think you can.

The trick is that when you pay for something you need to change the payment method (on the confirmation screen) from that of your bank account to your credit card. It costs exactly the same.

Paypal are real b*stards. If you use your credit card to pay for something then they have to pay commission to the credit card company. Their solution to that little problem is to make the default payment method = your bank. If you're clever and take the option to change the method to your credit card, they display a screen which disingenuously suggests that paying through your bank is "easier"; along with a couple of other spurious 'advantages'. There are NO advantages AND you lose the ability to do a charge-back through your credit card if you have a genuine dispute with the seller for amounts above £100.

What makes their policy even more annoying is that they already charge 'sellers' a hefty commission (far in excess of what they, Paypal, have to pay a credit card company). So if you pay using your bank, Paypal make a tidy profit (which is why they try to pull the wool over your eyes). And if you're a seller you have to change your account to a 'business' account in order to accept payments with a credit (or debit!) card. This means that almost all sellers (certainly on Ebay) are effectively forced to pay a high commission on EVERY transaction regardless of whether the buyer pays through their bank or not!

On top of all of that, if you buy on Ebay they offer a 'Buyer Protection Programme', but you have to pay a £15 excess even if you win the dispute.....unless the buyer has more than 50 feedback. In the former case you should claim on your credit card (assuming the amount is over £100). Even if the buyer has more than 50 feedback (in which case the £15 is waived), it can take months to get your money back and it's up to Paypal's 'discretion'. The only caveat to keep in mind is that Paypal have been known to close the accounts of people who have done a credit card chargeback.....but at least you have the option.

Bottom line...........the only advantage in using your bank to fund your purchase is if your seller offers a discount for non debit/credit card payments (pretty rare). In all other cases you should use your credit card to maximise your protection. Simply change the default 'funding source' on the Paypal confirmation screen to your credit card.

Valiant

soolin

valiant wrote:

Bottom line...........the only advantage in using your bank to fund your purchase is if your seller offers a discount for non debit/credit card payments (pretty rare). In all other cases you should use your credit card to maximise your protection. Simply change the default 'funding source' on the Paypal confirmation screen to your credit card.

Valiant

Sellers should not be charging different rates for different payment methods as that could be construed having to pay a premium for certain methods. Also even a bank account payment will trigger the need to upgrade to a premier account if there is a debit card associated with that account. So basically that means there is no advantage to a buyer in not using a credit card to fund payment.

Soo