For new users/sellers on e-bay I will give some answers to the most common questions about PayPal.
WHAT IS PAYPAL?
PayPal is, quite simply, e-bays own online bank, where you can add and recieve funds for use on e-bay transactions. It is also the quickest and easiest way to buy items on e-bay.
WHY USE PAYPAL?
PayPal is used by a large percentage of e-bayers, due to it's ease of use, speed of which you can send and receive payments (more or less instantly) and security. It is especially more convenient when dealing with overseas buyers and sellers, when sending a cheque or money order is very time consuming and costly. After all, when a payment is given or recieved instantly, you will recieve or send your item out more quickly. Many overseas buyers and sellers will ONLY accept PayPal as a payment method.
IS PAYPAL SAFE AND SECURE?
PayPal is one of the most secure banks in the world, with the best online security money can buy to prevent hackers from gaining access to private information. After all, e-bay makes many millions of dollars per year (if not billions), which can buy the best online security available.
And also, since PayPal is completely online, a robber cannot walk in and steal your money from a local branch down the street!
WHAT DO I NEED TO SIGN UP TO PAYPAL?
All you need to sign up to PayPal is an address and a bank account. PayPal will then verify both, to help prevent fraud against e-bay users. They will send a letter to the address you provide with a special code to be entered by you into your account. They will also deposit a (very) small amount of money into the bank account that you provide (usually something under 30 cents), which you will also have to verify by entering the exact amount into your PayPal account. You DO NOT need a credit card to use PayPal, however, if you have a credit card, they can be easily used in conjunction with PayPal.
DO I NEED TO TRANSFER FUNDS FROM MY BANK ACCOUNT TO PAYPAL IN ORDER TO BUY SOMETHING ON E-BAY?
No. Although it is advisable to transfer funds from your bank account to PayPal, this usually takes around 3-4 working days to clear, and the funds you transfer will not be available to use until cleared. If your balance in PayPal is zero, you can still purchase and pay for items on e-bay, but you MUST MAKE SURE that you have the AVAILABLE funds in your bank account, as PayPal will withdraw them out of your bank account the next business day. PayPal does not charge fees to transfer money from your bank account to your PayPal account.
CAN I WITHDRAW MONEY FROM PAYPAL?
Yes. PayPal gives you the option to withdraw any amount of money you have in your PayPal account into your verified bank account. It usually takes around 3 or 4 days to transfer the money from PayPal to your bank. However, if the amount you want to withdraw is under $150 AUD (australian dollars), PayPal will charge you $1 AUD to do so. For any amount over $150 AUD, it is completely free to withdraw to your bank account.
DOES PAYPAL CHARGE ANY FEES WHEN BUYING AN ITEM FROM E-BAY?
Virtually no. PayPal will very occaisonally charge you something called a 'currency conversion' charge, which basically means they charge you to convert from your currency (eg australian dollars) into another country's currency. In my experience PayPal VERY RARELY charges this fee, especially between the major countries currencies in the world.
DOES PAYPAL CHARGE ANY FEES TO SELL ITEMS ON E-BAY?
PayPal does not charge any fees to list an item on e-bay. However, if an item successfully sells, AND ONLY IF the buyer PAYS YOU USING PAYPAL, will you be charged a small fee. This is usually only around 40 or 50 cents per $20 AUD or so.
I am both a buyer and seller on e-bay, and I would not be able to buy a lot of things, or even sell a lot of things to a wide market without the use of PayPal. I estimate that around 75% of people who buy items from me pay for them by using PayPal. When I buy items, I pay by PayPal around 99% of the time, because if it's available, i'll use it for the security and in order to speed along the process of receiving my item.