How To Avoid Getting Scammed with PayPal

PayPal is an online payment service that is convenient for sending and receiving money from family, friends and third parties with whom you do business or provide services. It is also an easy method for making payments for online purchases and all kinds of buying and selling transactions.

However, PayPal can also be beset with problems that can blow up in your face and these are universal issues which plague ecommerce transactions in general, irrespective of site or portal; similar to issues affecting retail trades in real-time. Playing it safe in cyberspace or the real world is mostly about common sense and ensuring maximum security; there are plenty of scams and cons in play and there is no such thing as a 100% secure or foolproof system. Here’s some useful information that will help you stay alert and avoid getting scammed with PayPal (also applicable for any online activity where money is involved)!

Opening and maintaining a PayPal account

(a)    Provide accurate and true information which enables PayPal to verify and authenticate your identity.
(b)    Do not open more than one account with the same name and details, unless one is an individual account for personal use and the second is a business account where the business or company name is recorded.
(c)    Do not maintain high balances in your account, especially if you are a frequent buyer and seller on eBay (this is explained in further detail in the next section).
(d)    Check out your PayPal account frequently to see if any unauthorized transactions are listed. Cross-check your PayPal transactions with your linked credit or debit card or bank account.
(e)    Ideally link a credit card only to your PayPal account because it is easy and immediate to put a hold on disputed transactions. Linking a debit card or bank account means funds from these accounts will be used to make payments when the balance in your PayPal account is insufficient and you will stand to lose your money if the transaction in question is a fraudulent one.

(f)    Report any suspicious mails requesting your account details immediately to PayPal, to avoid identity theft or scammers using phishing.

Buying&selling with PayPal as mode of payment
Common PayPal scams can originate from both sides of a transaction, i.e. from a fraudulent buyer or a fraudulent seller. Follow these tips to avoid getting scammed when buying and/or selling with PayPal.

  1. Do not transact with unverified buyers or sellers.
  2. Avoid making high-value transactions (in excess of $50) through PayPal.
  3. Immediately report unauthorized transactions on your PayPal account, or if any product paid for through PayPal is not delivered or is not the item you paid for.
  4. Do not keep high balances in your PayPal account, fraudulent buyers can file complaints such as ‘item not received’ or ‘item not as per description’ and claim the balances held in your account. Also do not link a debit card or bank account with your PayPal account for the very same reason.
  5. Fraudulent sellers can claim money from your PayPal account by providing proof of delivery or a tracker number which cannot be verified, unless you back-track the whole transaction and check with the postal or courier services and are able to prove seller fraud.
  6. Read all terms and conditions pertaining to the item you’re buying, including product description and authenticity, shipping and delivery and modes of payment, each of these will be mentioned separately, so reading just one section and assuming the same T&Cs apply to others is foolish.
  7. As a seller on eBay or other ecommerce site, maintain records of shipping and delivery with unique transaction IDs or reference numbers (to challenge false complaints of “item(s) not received); insist on a signature confirmation/verification to avoid fraudulent claims of “item(s) received not as per description”; and finally, report cases of mail fraud to the relevant governmental authorities when you have sufficient, documented evidence of the same.

Follow the instructions listed above to avoid being scammed with PayPal or any other online payment service and keep your money and account status safe!


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