Protecting one's bank account from PayPal

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Tabulator
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Protecting one's bank account from PayPal

Post by Tabulator »

How do you protect your money from PayPal? I am concerned that any web interface that allows withdrawals from a bank account for the purpose of sending payments is a security risk.

I have found that having a PayPal account is not optional, and that not having the account linked to a real bank account is also not optional. I sell things from time to time. I don't trust PayPal and so I have a savings account at a bank I don't particularly like for the sole purpose of using PayPal. That way I can protect my main checking account from PayPal, because it is not even in the same institution. I am increasingly thinking this might be overkill and that I should simply open a new savings account at the institution I use most often, and use that new account with PayPal. Would that be enough (or is even that arrangement still overkill)?

It would be nice to consolidate deposit accounts into one institution.
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nisiprius
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Re: Protecting one's bank account from PayPal

Post by nisiprius »

Capital One 360, and probably many other online banks, allow you to create additional savings accounts instantly and transfer funds between them instantly. Each account gets its own account number. So one obvious answer might be to find an online bank you actually like, create a "real" account for ordinary purposes, and create a dedicated Paypal account that never has much money in it. If you need to pay via PayPal, you do an instantaneous transfer into to that bank account just before you do the PayPal transaction.
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Re: Protecting one's bank account from PayPal

Post by livesoft »

I do something similar: I have a secondary free checking account at my bank for travel with its own ATM card. I keep a limited amount of funds in it, but can transfer money to/from it instantly from my other checking account. Thus, if that account is compromised while travelling, I do not need to change my financial life (bill pay, bank info at brokers, direct deposit, etc.).
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Traveller
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Re: Protecting one's bank account from PayPal

Post by Traveller »

nisiprius wrote:Capital One 360, and probably many other online banks, allow you to create additional savings accounts instantly and transfer funds between them instantly. Each account gets its own account number.
Exactly what I do. I use that "firewall" account for all paypal and similar transactions.
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BolderBoy
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Re: Protecting one's bank account from PayPal

Post by BolderBoy »

I do what Nisi says - CU account with small checking balance which I bump up prior to a Paypal transaction. My real banking is elsewhere.
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Re: Protecting one's bank account from PayPal

Post by placeholder »

This is why I like my legacy PayPal linked to credit card only.
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Ice-9
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Re: Protecting one's bank account from PayPal

Post by Ice-9 »

I'd been living comfortably without Paypal for years, as I use just use a credit card to pay for things that offer PayPal payment, but decided to set up an account before our wedding last year in case people wanted to send gifts that way.

I thought I could avoid linking to a bank altogether, because they do have a policy where you can request a check withdrawl from PayPal for a small fee. However, when it came time to make the withdrawl, I opted for linking it to an extra old online savings account I still had $5 in from when I did a lot of rate-chasing and online-bank-switching back in 2006. I'm currently taking my time deciding whether I should now close the PayPal account or just leave it there in case I ever have another reason to use PayPal.
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Steelersfan
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Re: Protecting one's bank account from PayPal

Post by Steelersfan »

placeholder wrote:This is why I like my legacy PayPal linked to credit card only.
+1

I used to link it to my checking account but turned that off a few years ago.
rec7
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Re: Protecting one's bank account from PayPal

Post by rec7 »

placeholder wrote:This is why I like my legacy PayPal linked to credit card only.
Can you use a credit card only?
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SkierMom
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Re: Protecting one's bank account from PayPal

Post by SkierMom »

Link PayPal to a credit card, then cancel that credit card. This ensures Paypal will not make any charges to your account, at will, (which they are wont to do) nor have their hand in your pocket through your banking account.

I originally set up a separate savings-only account at a credit union separate from where I do my main banking. The sole purpose of this savings account was to backup PayPal and their huge fees and scare tactics.
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Re: Protecting one's bank account from PayPal

Post by dolphinsaremammals »

rec7 wrote:
placeholder wrote:This is why I like my legacy PayPal linked to credit card only.
Can you use a credit card only?
I have a paypal account linked to my credit card only. I don't know whether that is somehow a grandfathered feature.

I buy stuff on ebay and some or maybe all sellers require paypal. Also a couple of charitable groups accept paypal donations, and I am sometimes too lazy to write and mail a check.

A few years ago paypal told me I had reached some lifetime limit in $ of usage, and if I wanted to continue to use it I'd have to either link to a bank account or get a paypal credit card. I chose the credit card and never used it and set a $50 limit on it. After a year or two they canceled the card for non-use. I canceled my paypal account.

Some time later I got an account again. That seemed to reset my limit. When I use it now, it often gives me the option to either log into paypal or to charge outside it to a credit card. When I have the latter option, I use it, to presumably avoid increasing the limit, if limits still exist.
Deep Thoughts
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Re: Protecting one's bank account from PayPal

Post by Deep Thoughts »

I set up a separate account at my bank. I keep 100 dollars in it. Whenever I need to use Paypal, I always do the "change method of payment" screen. I have my
credit card there as a "backup payment method" in case there isn't enough in the bank account. Anyway, it allows me to purchase anything I need with Paypal on my credit card. It used to be if you did this, you had to put up with going thru an extra acknowledgement screen saying that you realize how awesome it is to pay with Paypal but you're going to use a credit card anyway.

Anyway, it's the best solution I've found. Paypal is ubiquitous ... you have to learn how to deal with it.
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FelixTheCat
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Re: Protecting one's bank account from PayPal

Post by FelixTheCat »

I have never had a problem with Paypal after a decade+ of use.

In case you want to read for yourselves, take a look a Paypal's promise on safety/security https://www.paypal.com/webapps/mpp/payp ... d-security
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Rob5TCP
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Re: Protecting one's bank account from PayPal

Post by Rob5TCP »

I link PayPal to a bank account with less than $100. My primary c.c. is a number that was compromised 1 year ago; every time I make a purchase I add a valid credit card
then remove it after the purchase is done. So Paypal usually has a useless c.c. and a bank account with $50-$75 in it.
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Re: Protecting one's bank account from PayPal

Post by leonard »

Tabulator wrote:How do you protect your money from PayPal? I am concerned that any web interface that allows withdrawals from a bank account for the purpose of sending payments is a security risk.

I have found that having a PayPal account is not optional, and that not having the account linked to a real bank account is also not optional. I sell things from time to time. I don't trust PayPal and so I have a savings account at a bank I don't particularly like for the sole purpose of using PayPal. That way I can protect my main checking account from PayPal, because it is not even in the same institution. I am increasingly thinking this might be overkill and that I should simply open a new savings account at the institution I use most often, and use that new account with PayPal. Would that be enough (or is even that arrangement still overkill)?

It would be nice to consolidate deposit accounts into one institution.
I use paypal all the time with no bank account linked, just a credit card. So, simply remove the account linked to your Paypal account - risk eliminated.
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rec7
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Re: Protecting one's bank account from PayPal

Post by rec7 »

leonard wrote:
Tabulator wrote:How do you protect your money from PayPal? I am concerned that any web interface that allows withdrawals from a bank account for the purpose of sending payments is a security risk.

I have found that having a PayPal account is not optional, and that not having the account linked to a real bank account is also not optional. I sell things from time to time. I don't trust PayPal and so I have a savings account at a bank I don't particularly like for the sole purpose of using PayPal. That way I can protect my main checking account from PayPal, because it is not even in the same institution. I am increasingly thinking this might be overkill and that I should simply open a new savings account at the institution I use most often, and use that new account with PayPal. Would that be enough (or is even that arrangement still overkill)?

It would be nice to consolidate deposit accounts into one institution.
I use paypal all the time with no bank account linked, just a credit card. So, simply remove the account linked to your Paypal account - risk eliminated.
Do you sell things or just buy?
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Re: Protecting one's bank account from PayPal

Post by carolinaman »

I sometimes sell NFL tickets on Stubhub which requires sellers to have a Paypal account even though I always ask for payment by check. Last year someone in UK charged my credit card for $999 for a bogus transaction. Paypal did send me an email notifying me of the transaction but by the time I saw it, the transaction had already occurred. I deactivated my credit card on Paypal and reported the theft to their fraud unit. They determined this was indeed an unauthorized transaction and reversed it. I also reported it to my credit card company and they handled it on their end. It took about 2 weeks for this to get reversed. Paypal was not sure how this occurred. The person whose account the money was transferred to was thought to be a legitimate merchant with Paypal. He had not responded to Paypal the last time I talked with them and I never heard anymore about it. My suspicion is that somehow Paypal's system was hacked to get the information needed for transaction. This is enough for me to not want to use Paypal ever again. Without Paypal's notification, I may not have noticed this for a while.
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JPH
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Re: Protecting one's bank account from PayPal

Post by JPH »

I just unlinked my bank account from PayPal, and then I still was able to pay a bill using the credit card option.
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Re: Protecting one's bank account from PayPal

Post by dbr »

I don't use PayPal and any business that insists on it doesn't exist as far as I an concerned. I haven't missed anything I wanted to buy or do as a consequence.
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Re: Protecting one's bank account from PayPal

Post by rec7 »

JPH wrote:I just unlinked my bank account from PayPal, and then I still was able to pay a bill using the credit card option.
Now I wonder if that would work if you sold something and were getting money.
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Re: Protecting one's bank account from PayPal

Post by JPH »

Nope. Don't think that would work.
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Re: Protecting one's bank account from PayPal

Post by rec7 »

Thanks. I have gone down the path of many here linking it to a savings account with very little in it. The only reason I have a bank tied to it is I sell a little bit also. I had a credit card hacked and I think it was tied to paypal but could not prove it. So after that I am very careful.
Last edited by rec7 on Fri Aug 29, 2014 10:32 am, edited 1 time in total.
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Re: Protecting one's bank account from PayPal

Post by WolfpackFan »

I've never had any problems with Paypal in the 13 years I've had an account with them. Is there evidence that Paypal is dipping into folk's checking accounts?

The one site I take precaution against and avoid using is mint.com, although I know of no issues with them. I can't believe some people give mint.com passwords and access to essentially their entire net worth. Seems it would just take one rogue employee to basically ruin your entire life.
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Re: Protecting one's bank account from PayPal

Post by abuss368 »

Knock on wood we have never had an issue with Paypal.

We recently called them as they still had an old cancelled credit card on our account listing and we could not remove it. The customer service representative was able to. While we were on the telephone, I inquired if we could remove the bank account and just leave the one working credit card. The customer service representative mentioned that we could but we might have problems with certain purchase transactions from eBay. We decided to leave the bank account for now but I really do not like our account number out there.
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Re: Protecting one's bank account from PayPal

Post by gardemanger »

Paypal with credit card is the only way I've ever used Paypal. Once in a while they try to solicit me to add a checking account but I ignore it. I don't use Paypal a lot but I do occasionally buy small items from individuals online via a collecting community, and it's convenient to have for that.
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Re: Protecting one's bank account from PayPal

Post by dolphinsaremammals »

abuss368 wrote:Knock on wood we have never had an issue with Paypal.

We recently called them as they still had an old cancelled credit card on our account listing and we could not remove it. The customer service representative was able to. While we were on the telephone, I inquired if we could remove the bank account and just leave the one working credit card. The customer service representative mentioned that we could but we might have problems with certain purchase transactions from eBay. We decided to leave the bank account for now but I really do not like our account number out there.
I can't imagine why there would be problems with ebay. I would call back and insist they remove the bank account.
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Re: Protecting one's bank account from PayPal

Post by Gauss44 »

rec7 wrote:
leonard wrote:
Tabulator wrote:How do you protect your money from PayPal? I am concerned that any web interface that allows withdrawals from a bank account for the purpose of sending payments is a security risk.

I have found that having a PayPal account is not optional, and that not having the account linked to a real bank account is also not optional. I sell things from time to time. I don't trust PayPal and so I have a savings account at a bank I don't particularly like for the sole purpose of using PayPal. That way I can protect my main checking account from PayPal, because it is not even in the same institution. I am increasingly thinking this might be overkill and that I should simply open a new savings account at the institution I use most often, and use that new account with PayPal. Would that be enough (or is even that arrangement still overkill)?

It would be nice to consolidate deposit accounts into one institution.
I use paypal all the time with no bank account linked, just a credit card. So, simply remove the account linked to your Paypal account - risk eliminated.
Do you sell things or just buy?
I sold something on eBay using a Paypal account and got scammed. The person who bought from me said that their account was hacked and got a refund. Paypal reversed the transaction. I was left with nothing. Buyer got what they bought AND their money back. Per an internet search this is becoming a common problem. Be careful!
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Tabulator
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Re: Protecting one's bank account from PayPal

Post by Tabulator »

PayPal may or may not be okay but the fact is that most PayPal accounts are protected by merely a single password. Worrying about one banking password is bad enough. By linking one's main bank account to PayPal, one will then have two to worry about. That's one too many in my opinion.
BradMajors
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Re: Protecting one's bank account from PayPal

Post by BradMajors »

There is no reason to link a bank account with PayPal. If you want to withdraw money, Paypal will mail you a check.
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Re: Protecting one's bank account from PayPal

Post by ubermax »

In our case PayPal is authorized ( by us ) to take money from our bank account if we spend more than we have in our PP account ; we've never had a problem with PP taking money from our bank account that they weren't entitled to - I guess there's always a first time but we just don't worry about it .
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Tabulator
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Re: Protecting one's bank account from PayPal

Post by Tabulator »

More up-to-date information about PayPal's lack of security (for those who can stomach the details).
Nevermind that it was PayPal's lack of any modern authentication methods that led to this mess. Also, let's forget for the moment that there are a half-dozen services online that let customers create fake but realistic looking scans of all types of documents, including utility bills, passports, driver's licenses, bank statements, etc. This is the ultimate and most sophisticated customer authentication system that PayPal has: Send us a copy of your driver's license.
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Re: Protecting one's bank account from PayPal

Post by Mr.Mosfet »

I don't think it's overkill. I use separate credit union solely for the purpose of interfacing with Paypal as well (Helps me sleep at night). I can easily move funds between institutions with ACH transfers or just stop by a branch/ATM for withdrawals.Personally I've never had a problem but I definitely do not trust them. I have a few acquaintances that have had to deal with funds being locked and unauthorized drafts from linked accounts.

I've been decluttering and selling stuff on ebay for the last couple of years and found the linked account to be the best option in order to withdraw funds (I don't want to mess around checks).
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Re: Protecting one's bank account from PayPal

Post by carofe »

For a small fee ($0.30 the last time I did) you can request a check for the balance you have in your PayPal account.
You used to be able to request the check on the website but now I think you need to call customer service.
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Re: Protecting one's bank account from PayPal

Post by SeeMoe »

nisiprius wrote:Capital One 360, and probably many other online banks, allow you to create additional savings accounts instantly and transfer funds between them instantly. Each account gets its own account number. So one obvious answer might be to find an online bank you actually like, create a "real" account for ordinary purposes, and create a dedicated Paypal account that never has much money in it. If you need to pay via PayPal, you do an instantaneous transfer into to that bank account just before you do the PayPal transaction.
Excellent idea that ! I too am leery of " PayPal" and the power they wield over my money affairs,...Thanks again.. :idea:
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Re: Protecting one's bank account from PayPal

Post by rec7 »

I linked my credit union savings account with $200 so my risk is only $200 I also have a very, very long password. I tend to buy low priced items on ebay.
Last edited by rec7 on Sat Jan 02, 2016 12:15 pm, edited 3 times in total.
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Re: Protecting one's bank account from PayPal

Post by Rob5TCP »

For years I kept a bank account with a small balance. Once, logmein, automatically renewed my subscription. It was for $249; since I only kept $40 in that bank account it PAID it and charged me $40 for the "privilege". I was able to cancel my bank account and it now only goes to my credit card. I had an argument with logmein and now it will only bill me for another year's service. The service charge stuck. The only time I've had a bank service charge (other than my safety deposit box).
I will never link a bank account with Paypal again. Maybe I was grandfathered. I don't know.
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Re: Protecting one's bank account from PayPal

Post by Rob5TCP »

Tabulator wrote:More up-to-date information about PayPal's lack of security (for those who can stomach the details).
Nevermind that it was PayPal's lack of any modern authentication methods that led to this mess. Also, let's forget for the moment that there are a half-dozen services online that let customers create fake but realistic looking scans of all types of documents, including utility bills, passports, driver's licenses, bank statements, etc. This is the ultimate and most sophisticated customer authentication system that PayPal has: Send us a copy of your driver's license.
That is daunting -- I have a complex password that is extremely hard to crack. I also use the security token. Nice to know they make it easy to override all the security I've setup.

I use to have a bogus c.c. (long story) on my account. Whenever I made a purchase I added my real one; then deleted it after the transaction. They caught on to this and that bogus card would no longer be allowed. LOVE PayPal - NOT. You HAVE to use them on many sites.
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Re: Protecting one's bank account from PayPal

Post by TravelGeek »

Tabulator wrote:More up-to-date information about PayPal's lack of security (for those who can stomach the details).
I read that post by Brian Krebs earlier today and it made me add a paypal-related todo item to my To Do list. Will look into replacing my current bank account with my PenFed $100 share account, which serves no real purpose otherwise.

I generally only pay by PayPal if there is no other online choice, which for me is rare.i did use it quite a bit earlier in the year when I was decluttering and selling on eBay.
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Re: Protecting one's bank account from PayPal

Post by leonard »

Tabulator wrote:How do you protect your money from PayPal? I am concerned that any web interface that allows withdrawals from a bank account for the purpose of sending payments is a security risk.

I have found that having a PayPal account is not optional, and that not having the account linked to a real bank account is also not optional. I sell things from time to time. I don't trust PayPal and so I have a savings account at a bank I don't particularly like for the sole purpose of using PayPal. That way I can protect my main checking account from PayPal, because it is not even in the same institution. I am increasingly thinking this might be overkill and that I should simply open a new savings account at the institution I use most often, and use that new account with PayPal. Would that be enough (or is even that arrangement still overkill)?

It would be nice to consolidate deposit accounts into one institution.
Paypal doesn't require me to have a linked account.
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Re: Protecting one's bank account from PayPal

Post by JonnyDVM »

FelixTheCat wrote:I have never had a problem with Paypal after a decade+ of use.

In case you want to read for yourselves, take a look a Paypal's promise on safety/security https://www.paypal.com/webapps/mpp/payp ... d-security
I'm with you. I'm annoyed when I owe someone money and they don't have PayPal.
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Re: Protecting one's bank account from PayPal

Post by dm200 »

I just paid a $550 bill for some tree work at my house with Paypal. I liked it to my American Express Blue card. No bank account.
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