PayPal and eBay were made for each other - and now that eBay own PayPal, using them together is getting even easier.

What is PayPal?

People with PayPal accounts can send money to each other securely online. You can deposit money in a PayPal account from a bank account or a credit card, and withdraw money to your bank account. It is the most common way of paying on eBay, as well as being in widespread use on the rest of the Internet.

Opening a PayPal Account.

It's very easy to get a PayPal account. Just go to www.paypal.com and click the 'Sign Up' link. As a buyer, you should get a Personal account - you can always upgrade later if you decide to start selling. Then all you need to do is enter your address, phone number and email address, and create a password, and two secret questions. You'll be emailed a confirmation, and then you're done!

If you want to deposit money into the account now, then you need to register a credit or debit card or your bank details, and if you want to withdraw money then you need to register your bank details. There's no need to do anything like that just yet, though.

Paying with PayPal.

Paying with PayPal is very simple. When you win an auction and click 'Pay Now', you'll be given a list of payment methods the seller accepts. You should always check what the seller accepts before you bid, as there are still some sellers who won't take PayPal. If the seller does accept PayPal, it will already be chosen for you on the payment page.

Now you just need to press 'Next', type in your PayPal username and password and confirm the amount you want to pay. The first time you pay with PayPal you will need to enter the details of your card or bank account, but after that it will remember for you.

Becoming Verified.

You might have noticed that there is a limit to how much money you can send or withdraw using PayPal before you need to be verified. Verification has two steps. First, PayPal deposit some very small amounts of money in your bank account and you need to tell them how much they deposited. Second, they need to phone you to confirm your address and phone number. Once you've done that, all the limits on your account will be lifted. Log in at paypal.com and click on 'Get Verified' for more information.

While you've been paying for your items, what you might not have realized is that eBay occasionally offers money off coupons. But where do you get them? The next email tells you all about it.

You have to be very lucky to be one of the chosen few who receive an eBay coupon by email. These coupons are just like cash that you can use towards anything you buy on eBay - the only conditions being that you pay using PayPal, and that you are using eBay in the USA, Canada or the UK.

There are two ways to get eBay coupons.

Wait for that Email.

Of course, if you just wait, you'll be waiting for a long time. You have to do something to make yourself look like the kind of person eBay would want to tempt back with a coupon. If you open an account, buy a few medium-value things and then suddenly stop, the chances are you'll find yourself with some kind of special offer - but still, not always.

Go Searching.

The better way, of course, is to go and find the coupons that are out there on the web. This is quite hit-and-miss, as eBay don't always have an offer on, but when there's a valid code you can guarantee that it'll be everywhere within a few hours. Just type 'eBay coupon codes' into your favorite search engine, but be prepared to pick through some rubbish. You might find you have better luck if you use a more obscure search engine, where people haven't taken the trouble to game the results.

If going through search engines is too much for you, then just keep an eye out at any community forums you frequent, where someone might just post one. You probably have the best chances if you make a few friends on eBay's own forums at http://hub.ebay.com/community. It can be fun and educational to chat to the regulars there too, so you really have nothing to lose.

How do You Redeem Coupons?

A coupon is basically a code, with some being quite long. All you need to do is pay with PayPal as usual for the item you want to use the coupon towards. After you choose PayPal as your payment method, you will notice a heading that says 'Coupons, Gift Certificates and eBay Anything Points'. Type the coupon code in here: they can be long, so you should use copy-and-paste to make sure you get it right. Just click 'Redeem', and it's good to go.

Don't worry about causing problems for sellers by doing this, by the way - they have no way of even telling that you used a coupon, as eBay just pay them for the item as usual. Coupons are good for sellers as they attract more buyers to eBay, meaning that they get more bids on their auctions. After all, why would they object to getting more money without you actually having to pay it?

Since you're interested in making your eBay shopping more affordable, you might be interested to know that you can now buy eBay items on credit. Our next email will tell you all the details of eBay's new '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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