If anything ever seemed too good to be true, it's ebay. The online buying and selling goliath is the place where people can buy things at a fraction of the price they are in the shops, and also make a heap of cash by selling off all the old junk that's cluttering up their home. So what's the catch?
For the majority of users, there isn't one. In fact, ebay usually works very well and is enjoyed by more than 182 million registered users around the world, with a mind-boggling 1.2 billion listings on the site. But, as with almost any situation that involves money and profit, there exists a small minority who attempt to take advantage of the system and extract cash from innocent users by fraudulent means.
Don't let this fact put you off, though. There are lots of ways to protect yourself. Certain safeguards are provided by UK law and others by ebay itself. Choosing the right method of payment can increase your protection further still. Of course, the strongest first line of protection is plain old common sense.
Here we show you how to avoid being burned by online auction scams and explain how you can enjoy online trading with confidence.
Even if you're yet to dabble, this ultimate internet auction place is still the must-use website for millions of people selling unwanted possessions.
As popular as it is, it's fair to say the whole ebay process can look daunting to the uninitiated. But a little research can help you avoid the pitfalls.
Learn more about ebay in our comprehensive guide, with helpful hints, tips, experiences and insights:
Buying and selling on ebay
The first thing to bear in mind when buying or selling on ebay is that the vast majority of users are decent, honest folk who are happy to play by the rules and provide each other with a smooth, hassle-free service.
The trouble is that most ebay transactions involve handing over payment before receiving the goods, so there's always an element of risk involved, particularly for buyers. ebay has a very good built-in way to help simultaneously reward and protect honest users: the feedback system.
Every time an ebay transaction is concluded, both parties involved are encouraged to leave each other feedback in the shape of a rating (positive, neutral or negative) and a short comment. Every ebayer's feedback history is available for others to see.
However, even someone with 99.6 per cent positive feedback could be harbouring more negative comments and disgruntled buyers than you might assume. If the person has been selling items in huge quantities, for instance, the percentage figure can be misleading. You should double-check the seller's full member profile history before you make a bid.
Registering on ebay
To use ebay, go to www.ebay.co.uk to register.
Your next move should be to sign up with PayPal. PayPal was set up by ebay and allows you to transfer and receive funds online. It offers a greater level of security than cash or cheque.
Listing on ebay
Before you start the listing process, it is advisable to take digital photos of the item and upload them to a computer. Another option is to scan a print. ebay offers photo tips here.
It is also a good idea to get an up-to-date list of postage prices from the Post Office, so you can work out how much to charge for postage.
Now go to the ebay home page and click on the 'Sell' button in the top right corner of the screen.
Quick or Advanced listings on ebay
Enter a few words in the box to describe your item. There are two options, 'Quick Sell' or 'Advanced Sell'. You will probably want to use 'Quick Sell' - you can progress to 'Advanced' as you become more confident.
ebay will give you simple step-by-step instructions as you move through the process.
Worried about scams on ebay? Read our guide.
Some options are only available under 'Advanced', eg: Reserve Price (the option to set a minimum selling price) and Postal Insurance.
Posting photos on ebay
You have nothing to lose by uploading a photo, as the first one is free. Items with a picture stand more chance of selling, and on average sell for more.
Checking the 'Gallery Photo' box means your snap will be displayed automatically - without potential buyers having to click again.
Accuracy of descriptions on ebay
Take careful note of the guidelines provided on screen. They will offer protection against issues, such as possible comeback from the buyer. Take care to describe any flaws honestly.
Payment and postage on ebay
The 'Buy it Now' option allows purchasers to bypass the auction and buy there and then for the price you state.
ebay now insists sellers offer the option of PayPal - except in a handful of categories. For some items it is the only payment method permitted. It usually also possible to pay by personal cheque, postal order - or cash (if the buyer collects in person).
Got an old mobile phone or unwanted electrical gadgets? Read our tips for selling them.
Check your ebay listings
When you have worked your way through these six stages, click 'Save and Review'.
You will now see your advert as it will appear to the world. Check it carefully and click 'Edit Listing' at the bottom if you need be. When you are happy with it, click 'Place Listing' and your item will go on sale.
ebay will debit a small fee from your bank account – remember each additional option costs a few pence extra.
That's it! For now.
ebay bidding process
Sit back and (hopefully) watch the bids roll in. ebay will confirm the listing by email and notify you whenever a bid is made.
At the end of the auction it will email to let you know whether it has sold - and if so, for how much.
The system will generate an invoice for the buyer who now has to arrange payment by one of the methods you specified. Most commonly, PayPal.
Convention has it that the seller waits for the funds to arrive in his account before despatching the goods.
Problems can occasionally arise with the buyer pulling out. In that case the second highest bidder will be offered the item. If you feel you have been given a rough deal, see the 'Help' section for advice.
Despatching goods on ebay
Once you have received the funds, despatch the goods as quickly and as carefully as you can.
Take great care to pack the item properly. If it is even vaguely fragile, be sure the package is labelled as such and use plenty of padding such as polystyrene balls and bubble wrap. The last thing you want is for the goods to arrive smashed to pieces.
A thorough online guide to packing items can be found here.
Feedback on ebay
The final stage is to leave feedback on the buyer – who will likewise leave feedback on you. Feedback is ebay's system for monitoring users' integrity.
Anyone who buys or sells from you (and vice-versa) is invited to leave Positive, Negative or Neutral Feedback – plus comments if they wish.
Negative feedback is very damaging and a powerful deterrent against shoddy behaviour.
Feedback is public and permanent – it is important to try to resolve any disputes privately if you can, unless it transgresses ebay's feedback removal policy.
If you feel you have received undeserved negative feedback – provided you and your trading partner agree – you can both withdraw your feedback ratings via a Mutual Feedback Withdrawal Form. You can also leave a polite reply to the feedback you received, or a follow-up comment to the feedback you left for another member.
It is possible to make your feedback profile private – but potential buyers will see this as a sign you have something to hide.
Learn from ebay history
Despite the feedback process, even the cleanest-looking ebay history cannot be trusted fully. You may recall a fraud gang from Lancashire which was caught conning people into handing over their ebay identities using faked emails. The email messages sent by the gang looked like they were from ebay and asked people to enter usernames and passwords.
These details allowed them to assume the guise of trustworthy sellers and appear as if they had a long, successful record of selling on the site. In reality, the scammers were using their stolen seller IDs to flog non-existent items and then walk away with the cash.
It's a classic phishing scam, and if there's a moral to the story, it's that you should never enter any private details into emails, or any websites that are accessed by clicking a link in an email. ebay itself offers advice and protection against identity theft and email or website 'spoofing'.
Most items listed on ebay will be sold by private individuals, but tens of thousands of people in the UK make a living from it - and many more abroad.
An ebay shop is a seller who has registered as such with ebay and pays a monthly fee. Unless you are certain you want to reach small business levels of selling, start out as a standard private seller.
ebay claims its shops help boost sales and build your brand. It allows you to display all your listings in one place, customise the look and feel of your shop, manage your sales and receive free reports on sales and visitor traffic.
Each item listed in an ebay shop incurs an insertion fee and, if it sells, a Final Value Fee.
Safety with ebay
Head to the site's Safety Centre and you'll find steps on how to create a good password and keep it safe, for example. Perhaps more usefully, it provides a free-to-download toolbar, which includes Account Guard - an automated security tool that presents a warning if you arrive on what may potentially be a fake version of the ebay website, and reports the site to ebay.
How to avoid fraud on ebay
When we asked ebay about fraud, we were told that "ebay does not release numbers on the numbers of transactions that fall victim to fraud because it is very hard to be accurate about this area".
It’s safe to say, however, that fraud forms only a tiny fraction of the vast number of transactions that occur on the site.
If an item is damaged on arrival, significantly different to the description offered on ebay, or if it doesn't even turn up at all, it's more likely to be due to an accident or a misunderstanding rather than fraud. As such, situations like these can usually be sorted out by opening the channels of communication with the seller. ebay will provide you with the vendor's email address and, if necessary, phone number.
There are ways of minimising the possibilities of anything going wrong in the first place. Dan Wilson, community manager at ebay.co.uk believes that: "ebay.co.uk is a very safe place to trade, as long as customers follow the best-practice guidelines for its use - using the feedback mechanisms to understand who they are dealing with, reading areas such as the Safety Centre before they start using the site, using a safe online payment system."
The latter is key. Cash and cheques are obviously the worst ways to pay for items, security-wise. Most money transfers and direct payments via internet banking, too, offer virtually no safety net if things go wrong. Credit-card companies do offer protection on certain types of purchase but few individuals have the facility to process credit card payments. That pretty much leaves us with PayPal. Our payment friend?
About PayPal - ebay's best friend
Owned by the online auction house itself, PayPal remains the best way to pay for something won on ebay. It's a third-party service that deals specifically with the sending and receiving of funds and has a certain amount of security built into it. By acting as an agent between vendors and buyers, payment details are kept private, electronic and, theoretically, safe. PayPal also has a number of other features that help its security, including buyer-protection coverage, offered on qualified ebay purchases, for example.
Buyer protection with PayPal
Users who want to use the protection scheme should look for the PayPal Buyer Protection shield icon before placing a bid. Only sellers with spotless transaction histories can qualify for the Buyer Protection symbol.
The PayPal website explains: "PayPal’s Buyer Protection programme entitles you to reimbursement for the full purchase price of the item plus the original shipping costs you paid, if any, when you don’t receive your item from a seller, or when you receive an item, but the item isn’t what you ordered."
Even if your vendor isn't covered by this scheme, the PayPal Resolution Centre will investigate any dispute you may have with a vendor, intercede on your behalf and attempt to resolve the issue.
That's not to say it always succeeds. "Be aware that PayPal protection does have its limits both in terms of cost and practicality in respect to the way the system works," advises Richard Webb, lead e-commerce officer for the Trading Standards Institute. "Users should read the terms and conditions carefully and understand what they mean."
Those terms and conditions are worth looking at; under some circumstances they change depending on the country in which the buyer and seller is based.
Credit cards and PayPal – important information
One thing to bear in mind is that using your credit card to pay for items via PayPal doesn't give you "double" protection. A representative of UK payments association APACS told us that by introducing a third party into the payment mechanism, you are effectively relieving the card issuer from responsibility for payment protection.
The contract with ebay
It is crucial to remember that when you buy or sell something on ebay, you are not actually entering into a contract with ebay itself, but rather with the person you are buying from or selling to. It's usually in your best interests to settle the matter between yourselves, but if you can't come to an agreement, you could try to get an independent mediator involved.
Square Trade, for example, offers professional mediation services specifically for online transactions and comes recommended by ebay.
The bad news is that, if things go really wrong with an ebay transaction and you want to pursue the matter to the small claims court, you may not be covered by UK consumer law.
"ebay users should be aware of the fact that they're buying from a private consumer," says Mr Webb.
"So their rights are a lot less than when buying from a shop or a trader."
Technically this is true, but it largely depends on whether the vendor can be described as a "private seller" or a "private trader". A private seller is an individual who sells items on an occasional basis for fun and a small profit. But if, say, an ebay vendor sells a substantial volume of items, has an ebay "shop" or online store and frequently sells multiple copies of the same item, they could qualify as a private trader under the law.
Using ebay as a business
Switching to the seller's point of view, it's important to understand the implications of using ebay as a platform for business. Should a judge decree that you are a private trader and not just a casual ebay user, you might find yourself suddenly bound by much more complex consumer laws.
Before taking any legal action, you should take advice from the Consumer Direct website or from Citizens Advice. Bear in mind that taking a matter to the small claims court may not be worth the time, effort or money required to see the thing through.
How much does ebay protect its users?
All of this raises the question of whether ebay is doing enough to protect its users. Naturally, ebay's Dan Wilson thinks so. "Education of our users is the long-term solution to fraud," he says.
"However, we make huge investments in our own anti-fraud technology and customer service and fraud teams. We also work extensively with a range of outside organisations."
Richard Webb believes there are limits to what ebay itself can physically do. "Given the vast number of users and the volume of items being bought and sold on ebay, it's extremely difficult to police it completely," he says. Mr Webb also freely admits that the system isn't perfect.
"Things do go wrong occasionally. Don't take a risk you can't afford."
Despite this, it's worth reiterating that abuse, deceit and fraud barely register a blip on the ebay radar. With judicious use there is no reason to get anywhere near hot water. Perhaps the most sensible course of action would be to only buy using PayPal from users who display the Buyer Protection shield.
Read the details of any listing carefully and if you're ever in the slightest doubt about an item or its seller, don't make a bid.
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