Finances & Money

Making Your PayPal Experience More Secure

This guest post is brought to you by The Digerati Life, a personal finance blog that shares business and savings tips and reviews top brokerages for small investors and traders alike.

With the online world fast expanding to become a crucial medium of commerce, more and more people are bringing their businesses online, building business models that are purely Internet-based, and a growing working class is starting to live off the Internet. One of the most salient aspects of business is the exchange of money. And one of the most important modes of payment online is PayPal.

So, what is PayPal? Here are a few definitions:

PayPal is a Web-based application for the secure transfer of funds between member accounts. – TechTarget.com
PayPal is an e-commerce business allowing payments and money transfers to be made through the Internet. PayPal serves as an electronic alternative to traditional paper methods such as checks and money orders. – Wikipedia
PayPal is an account-based system that lets anyone with an email address securely send and receive online payments using their credit card or bank account. – RealCartU.com

There you have it.

So how do you use PayPal? Here are the basic steps:

1. Create an account.
2. Link your credit card, debit card or bank account (if you reside in the U.S.) in order to verify your account.
3. Wait for your EXPanded Use code (EXPUSE Code) to arrive in your credit / debit card account / online banking system via your email or through your credit card statement and verify your PayPal account using that code. This is the way PayPal validates your account.
4. Start sending or receiving money online using PayPal!

Just a note, you will be able to work with your PayPal account instantly, even as you’re waiting for it to be verified. The only catch is that you’ll have a sending limit of $500, and you will not be able to withdraw whatever PayPal funds you receive until you verify it with your EXPUSE code.

Your EXPUSE code normally arrives in your online transaction account within a day or so, if your banking system has a fully automated system. For some other banks or credit card companies, however, you may have to wait for your credit card statement to come in the mail so you can get your EXPUSE code. Take note that PayPal will deduct a small amount from your credit card, debit card or bank account. Once you’ve entered your EXPUSE code through the verification menu, all your account limits get lifted and you may use your PayPal account to your heart’s content!

In the past, there was so much misinformation about PayPal that a lot of prospective users shied away from using the payment facility. However, the truth is that while there are dangers to using PayPal, other payment facilities are not immune to these dangers, either. PayPal is actually far more sophisticated and secure than most other online payment facilities.

However, no matter how secure a system is, it’s still a good idea to have some protective measures in place. Here are our tips on how to keep your PayPal account, as well as the linked credit card, debit card or bank accounts secure:

1. Use a good password: vary the cases you use, add special characters, numbers and punctuation marks in order to make your password hard to guess or decode.
2. Don’t ever enter your password if you receive an email asking for your PayPal password. Log in only via the website itself.
3. Use a credit card with a very low credit limit. If you’re a student, use your college student credit card for your PayPal account. You can’t afford to risk huge charges on your account, should there be any anomalous activities that may arise.
4. Use a debit card or bank account with limited funds for your PayPal transactions. Better yet, make sure that you empty your accounts regularly. Keep limited PayPal balances: only what you need to pay bills or pay people, and withdraw incoming funds as soon as you get them. Then transfer the funds from your linked account to another bank account that has limited reach.
5. Be vigilant with your subscriptions. Should you choose to unsubscribe from anything you’re paying via PayPal’s autoenroll or auto-bill system, always check if you’ve truly unsubscribed. The first time the billing cycle renews, check that you’re not being debited any longer. If you’re still being billed, then file a complaint immediately.

While we’re warning you to take precautions with your PayPal account (or any online payment system, for that matter), it’s worth noting that these systems have become necessary and essential to conduct business on the web. Truth be told, most online business transactions these days are done via PayPal or other online payment systems, and most internet entrepreneurs wouldn’t have it any other way. Why? Because these systems have matured through the years and have proven that they can be effective, secure and robust.