This particular article is aimed at those just starting their eBay journey and wondering, as I did in the beginning, how to go about maintaining the best possible security for their money.

As many did before me, I was initially using my credit card for the first few purchases, knowing that I was not comfortable with doing so.  I had heard long before about credit card theft, but being curious about the auction, decided the risk was worth it provided I could find a more secure means to make my purchases.

My first few buys were fun and interesting.  Then came payment time, and the uneasy feeling of posting my card number into cyberspace overshadowed the event.  It was a nervous time.

Using Paypal to make my payment helped, but there was still that nagging idea that I was using my main, personal account number to complete the transaction.  If this number ever got out, someone would have direct access to my entire account.  I could be cleaned out before I even shut down the computer that night, not knowing until I could check the account the next day.

Within a day or two of that auction, I went into Paypal for some ideas of how the better protect myself from account theft.  It was suggested to use an electronic withdrawl from my bank account, as opposed to a payment from the card.  This meant having to open a new account and fill out the proper forms online.  It also meant having to notify the bank of the new online account and do their paperwork.  All in all, a bit of running around for me. 

At the bank, my teller (an eBayer herself) told me she had opened a special account, strictly for Paypal transactions and nothing else. An ATM account whereby she could transfer money from one account to another instantly to cover any purchases she made, from anywhere she happened to be.  She had also made arrangements to make automatic transfers once a month, for a set amount, in order to "reload" her account.  The more I talked to her, the better I was starting to feel about online purchases and auctions.  What she porposed was, in my opinon, the most secure way to handle my money transactions online.  I did what she suggested, opening a new account then and there.  I went back to Paypal, did their thing and started off knowing that if the worst case scenario happened, my account being invaded, the perpetrators would only get my Paypal account, not my main account.  I could live with that.

This has been my system for all but the first few transactions on eBay.  Granted, you can open an online account through Paypal, and for some, that may work.  I decided not to, as it takes considerably longer to deposit money into that account than my local bank.  With my local bank, I have more control over the money end of things.

Here are the steps I took to get where I am now.

I went to my bank and opened a seperate account.  Back into Paypal and registered that account number with their site.  Did the deposit thing they required and waited a day or two to make certain Paypal had all they needed.  I then went back to the bank and set up the automatic transfer from another account to the Paypal account.  A few days later, got my new card from the bank to enable me to make transfers on the spot, from anywhere in the world.  Although it took about 5 business days to set all this up, I feel my time was well spent to ensure that my account is as safe as it possibly can be.  I also have peace of mind knowing that if the worst happens, I will know exactly how much was is missing and it won't be much. 

Don't get me wrong here;  Paypal has never let me down and I applaud their way of handling the transactions I have made over the years.  Never an unkind word for them.  Paypal, however, is not a bank.  They have limited insurance and are not FDIC insured.  They cannot provide overdraft protection in case I mess up.  They also do not have the fastest deposit program and nowhere near as fast as my bank can put money into my account.  Paypal has been a good agent to make the payments and that is what I use them for.  My bank holds the money; Paypal distributes it for me to the sellers.  A good system that has not failed me once over the years.

As with so many stories I have heard, a sad scenario happened close to home recently.  A friend who had been into the auctions for only a short time had his account violated (badly, I might add) during a transaction.  He had been using his credit card directly for his purchases and inevitably, someone intercepted it.  Although the incident did not happen as a result of an auction ( it was actually a private buy), it did happen.

Could it have been avoided?  Yes, of course.  All fradulent deals can be.  Safeguards must be in place to work for you.  He had none but did have a way of paying for this particular transaction throught Paypal.   He opted to go it "naked" with his card directly.  A very bad move on his part. 

As I stated in the first here.  This is written for those just starting out and not sure about the money handling end.  There were a lot of things for me to learn early on.  I just wanted to get it right the first time.  I think I did.

Hope this helps.  The bottom line is; safeguard your money, your account and your transactions.  The more barriers you can put up before the thieves, the better your chances are of not experiencing a wipe-out.  Good hunting.

Mike