Can you remember what life was like on the Internet before PayPal? Do you remember how buying from online auctions was a time-consuming lottery? Before PayPal came along most auctions required the buyer to send a personal check to the seller. If things went well the seller would receive the check two or three days later and would deposit it. It then took about five to 10 business days for the funds to clear. Only after the transfer of the funds had been verified would the seller send the item. Of course, if the seller was a fraud, there was precious little the buyer could do about it since the transaction had already gone through the account. Paying by certified check was a bit faster, but once again the buyer needed to have extraordinary faith in the seller, and also had to go to the grocery store or bank to purchase the check.

Once PayPal had entered the scene those two forms of payment became virtually obsolete, although some sellers still offer the option of paying with a personal or certified check. However, most buyers do not want to bother with these kinds of payment any more. Thus PayPal conveniently serves as an electronic alternative to traditional paper methods of payment such as cheques and postal money orders. PayPal performs payment processing for e-commerce sites, auction sites, and other businesses. Sellers and buyers alike have realized that using PayPal is a good idea, not simply because it makes transactions quick, easy, and convenient, but also because it offers security of payment for transactions that take place on the Internet ? an environment littered with false claims and fraudulent transactions.

Another boon that PayPal has brought to its small business clients is the fact that enables payments to be processed by credit card, even if the seller does not have a merchant credit card account. It is much easier to set up an account with PayPal than to apply for a standard credit card merchant account. That fact alone really helps small businesses to become viable on the Internet. For example, Many eBay sellers are now able to open stores which are set up to take credit card payments even though the average eBay seller does not have a merchant account set up with MasterCard or Visa. PayPal came to the rescue by permitting the seller to accept the buyer's credit cards via PayPal's payment processing service.

Nevertheless, a lot of criticism has been directed at PayPal over the few years of its existence. In part this is because numerous attempts have been made by hackers to breach PayPal's security codes. Moreover, some SPAM messages that arrive in an unsuspecting victim's inbox look convincingly realistic and have caused unsuspecting customers to reveal passwords and other personal details which has granted third parties access to their accounts. However, this is a relatively rare occurrence. PayPal works hard to make sure that clients are aware of the safety precautions they need to take to maintain the security of their accounts. There were also some lawsuits brought against PayPal's business practices with respect to the resolution procedures arising from business disputes. The legal cases have been resolved satisfactorily, so once again the question as to whether using PayPal is a good idea can be answered with a confident and unqualified ?Yes?.