What is an eCheque?
Why is it delaying the dispatch of my order?
As a seller on eBay, we sometimes we get a Paypal eCheque as a payment method. Unfortunately many people are not aware that eCheque’s will hold up dispatch of their order, so we thought we would give you the low down on this method of payment and exactly why eCheque’s hold up the dispatch of orders.
Paying for your goods with PayPal
PayPal is a very popular method of payment especially for items purchased through eBay. Many people are unaware however that there are two ways to pay through PayPal.
The first is where there is sufficient funds within your PayPal account and/or you have a credit/debit card on file with them. This will be an instant transaction and the seller will receive the funds immediately and so your purchase will not be delayed.
The other method is what PayPal have termed an ‘eCheque’. eCheque’s are where you have an insufficient balance within PayPal account to pay for your goods outright and you do not have a credit/debit card on file with them. As PayPal will not allow your account to go into debt they take the necessary funds required to complete your transaction from your bank account via Direct Debit.
This request for funds from your bank account is where the delay stems from, as it can take 10 to 14 days for PayPal to clear the funds from your bank and pass them on to the seller. Lord only knows why they take so long but unfortunately they do. The cynical might conclude that PayPal sit on the funds for a week to earn interest.
Whatever the reason, during this period the seller is instructed NOT to send any goods until PayPal confirm payment has been met. This is because, like a paper cheque, there is no guarantee that the payment will go through. After all You can’t really expect the seller to send the goods out before they have received a payment which might never clear.
This all creates a very frustrating situation for the buyer if they need their purchase urgently. This is compounded as PayPal do not tell you that payment will not be made to the seller for at least a week so the first the buyer knows about it is when they enquire a week later where their goods are only to be told "we haven’t received your payment yet".
How can you avoid the eCheque trap?
To avoid delaying your purchases it is a good idea to link a credit/debit card to your PayPal account. It is perfectly safe as PayPal never disclose your card details to a seller and doing so will enable you to make instant payments regardless of your PayPal balance.
It will also verify your address making you a full verified PayPal member which will allow you to benefit from PayPal's buyer protection scheme.
Another added advantage is it will also allow you to purchase a wider range of goods as some sellers selling small, high value products such as iPods and cameras etc will not accept payments from non-verified buyers or eCheques.
I hope this guide has helped to explain echeque's clearly. It would help enormously if PayPal brought this information to the attention of all their customers when they make a payment via an echeque.