PayPal account - advice - credit card or direct checking account as default?
Situation: From time to time, I buy stuff on Ebay and sell stuff on Ebay. PayPal seems to be the default choice (and to be fair, the easiest choice) for handling money both coming and going.
PayPal gives lets you have multiple sources of funding (and receiving money) tied to a PayPal account. In my case, I have a checking account and credit card associated. You have to choose a default – which PayPal sets to checking account, since it costs them less (ACH debit versus the 3% they are charged by the credit processors). Herein lies my question.
Checking account advantage:
– easy, direct transaction. Fastest way to close out a buy or sell
Checking account disadvantage:
– a third party has direct access using ACH and can put through unauthorized debits (although theoretically PayPal protects you)
Credit card advantages:
– put off payment for a month
– better protections if you are cheated
Credit card disadvantages
– length of time between purchase and payment
– not sure if there are any others
So what should I select as my default payment / credit method?
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6 Answers
My default into my bank. Just because I don’t want to balance out from my pay pal into credit card then pay with banking. But I don’t think theres anything wrong with using it into the credit card and then paying that off. The plus with using bank is that you can tranfer to and fro, but I don’t think you can put money into your credit card from paypal.
It’s completely personal @elbanditoroso. We all use our bank accounts (Mom, husband & I) here in this household. We have security limits on the checking account tied to Paypal, so while theoretically someone could put through unauthorized charges it couldn’t total much.
Personally, I have been on ebay/Paypal since 2001 and have never had a problem with any unauthorized charges. In the past 12 months alone I’ve had 1300 transactions.
@SpatzieLover – wow, that’s a lot of transactions. You must run a business. I’m just a guy who buys stuff 2–3 times a month and sells stuff maybe once every two months.
We have always used PayPal and one of our checking accouns as the default.
Never had a problem either purchasing or selling.
I’ve used PayPal with my bank account for about as long as PayPal has been around. I have never had a problem.
As a general rule, I default to providing a credit card to third-parties for automatic draft purposes. My opinion is that if they accidentally withdraw a large amount directly from my checking account, then subsequent checks might bounce. Recovering from that scenario is typically costly in both time and money.
That said, when I make purchases through PayPal, they’re usually one-off and PayPal provides instant verification. Since I prefer to avoid running up credit card bills and pay off my debt, I’ve chosen to link PayPal to my checking account.
In other words, PayPal is the exception to my rule.
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