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									Introducing the New eBay "Buyer's Credit" Program.

In an effort to compete with more 'traditional' shops, eBay has started
to offer finance agreements though PayPal for expensive items. This means
that, if the seller decides to offer it, you can now spread the cost of
an item into affordable monthly payments.

This is good for buyers, good for sellers, and good for eBay. Buyers can
get the kind of credit agreements they're used to in shops. Sellers can
make their items more attractive to buyers who might not have all the
money then and there, but eBay still pays the sellers upfront - they
don't have to wait to be paid each month or anything like that. Buyers
make their monthly payments to PayPal's credit provider instead.

The APR of the Buyer's Credit program is currently 12.9%. You can pay
back $999 or more over 12 months, or $1,999 or more over 24 months. There
are also interest-free options for purchases of $199 or more over 3, 6 or
12 months.

The reason why some of these credit offers sound better than others is
that it is up to the seller to decide how good the credit offer should be
and pay extra to PayPal to offer it. To give their buyer the best
promotion, for example, of no interest for twelve months, the seller must
pay 3.75% of the item's cost to PayPal.

Basically, this means that sellers pay less when the buyers pay interest,
and sellers pay the cost of the interest on the interest-free offers.
PayPal makes its interest either way, buyers are happy to get credit, and
sellers are happy to sell more.

Can I Get This Credit?

On items over $199, Buyer's Credit is now being automatically offered to
buyers in the USA only. Just click the link when you buy something for
more than $199 and you will be taken through the application process,
which includes a 30-second check on your credit history. Then you just go
through the buying process as normal, and you get your item before you've
paid a penny.

Why are eBay Offering This?

eBay say they want to "level the playing field", to allow eBay businesses
to compete with the big chain stores, and they also want to promote
PayPal as a payment method. Relatively few buyers can afford the more
expensive items on eBay all at once, and so the introduction of Buyer's
Credit seems likely to significantly increase prices and sales at the
higher end of the market.

It is worth noting that you can use Buyer's Credit anywhere PayPal is
accepted, not just on eBay. PayPal say it's "like a credit card - minus
the card!" You don't get a card number - you can pay with credit with
just your email address and password.
The only thing left to do now, then, is find the best deal for that
really special item - the expensive thing you've been wanting for ages
but could never afford. But how can you be sure you're getting the best
price? Try our tips and tricks for eBay searching, in the next email.

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