Paying for Items on the Forum, alternatives to Paypal, Venmo and paper checks

[Zbench]

Happy Near Year all. I was going to post this in Swapping and Selling, but, looks like this kind of post is not allowed there, so thought this would be the best place for it.

People have various opinions on Paypal, their political activism, their taking of fees, etc. Same goes for Venmo. Some like the convenience, some like the recourse and it does have it's advantages. However, I wonder how many people know about other electronic methods to pay for items that are offered for sale here? In this post I'd like to explore a couple.

Zelle
Zelle is a bank to bank payment method that takes money from your account and directly transfers it to another person. Zelle uses ACH (automated clearing house) technology. Unlike normal ACH payments, and like paypal, Zelle acts as the "float" to give you your money immediately rather than wait for it to clear (keep this in mind for the next option). According to Zelle's website, 97% of banks use Zelle, and even if your bank doesn't, there is a third party app you can download to allow you to use it with your bank or credit union. If your bank does offer Zelle, it is likely sitting inside your online account waiting to be activated. I just used it last night for a person here who didn't know about Zelle. He found his bank offered it, he activated it and sent me the money for an item in minutes.

Pros:
1) Zelle is free. Member banks do not impose fees on Zelle transactions.
2) Zelle is fast and easy, the money is in your account in minutes
3) Registration is through your phone or email. You can also send a Zelle generated QR code to the person you want to exchange money with. Zelle shields your account number from the person on the other side of the transaction so all they see if your name.
4) No 1099 events, it is up to the sender or receiver to accurately report their tax burden based on the circumstance

Cons:
1) Like taking money out of your account and handing it to someone, there is no recourse. No buyer protection, no cancellations, once initiated, it's done. You need to be very sure of who you are sending money to. I like to do a "test" transaction by sending or receiving a dollar to make sure everything it right. If it is, the balance can then be remitted
2) There is a daily limit imposed by your bank. It varies between $2000-$3500. If it's a big purchase, it might take a few days to complete the process

Summary: Zelle is a quick, easy and free service to allow people to instantly send money to people they trust using the ACH network

FedNow
Fednow is a new bank to bank payment method that is not yet live but will be available the middle of this year. Fednow is a payment service that is being developed by the United States Federal Reserve to allow member banks, AND THEIR CUSTOMERS to send cash payments to anyone in the Network. Unlike an ACH transaction which in actuality takes days to settle, FEDNOW payments are immediate, like less than 10 seconds immediate. It is my view that when this goes live, Paypal and Venmo will be out of business. The only advantage of using those services in a post Fednow world is buyer protection. I'm not sure how much protection actually exists, but I'm not a huge paypal fan/user, so your experience might vary. This service will be offered by the Federal Reserve to member banks. I expect that there will be development on the member banks side to allow people to sign up and use the service, but it is going to be huge. You can read more about it here (https://www.frbservices.org/financial-services/fednow/about.html#:~:text=The%20FedNow%20Service%20is%20a ,every%20day%20of%20the%20year.)

Pros
1) Developed and backed by the Federal Reserve, the Central Bank of the United States
2) Instant settlement of funds, <10 seconds
3) Free service with no fees incurred to buyer or seller
4) No 1099 events, it is up to the sender or receiver to accurately report their tax burden based on the circumstance

Cons
1) Like Zelle, there is no recourse. Once the money is sent, it is gone from your account, so you need to be very sure of who you are sending it to
2) Not yet live, but is slated for mid 2023

Summary: Fednow will be a quick, easy and free service sponsored by the Federal Reserve to it's member banks which will allow rapid transfer of funds and instant settlement.

Now that Congress has tightened the reins on buying and selling reporting of online transactions, these services do provide real advantages to their users by keeping you out of 1099 purgatory for daring to reimburse Aunt Mabel for your share of the pizza at the family picnic. I thought the members here might enjoy knowing about these services if they didn't already. Additionally, at least in my neighborhood, theives have been breaking into the USPS outdoor mailboxes, harvesting checks, altering them and cashing them. So, sending payment via old school paper check is a risky affair. If you still pay like this, please go inside the USPS Post Office in your town and drop the letter there. This is a big problem across America. Using either of the services above can protect you from that kind of graft and corruption.

Pete

[Smoke4320]

sorry but Zelle is a con man/scammers playground. Massive amounts of fraud and many many people have had their bank accounts drained with NO recourse. I would do a lot of research on this one

[Zbench]

That's not my experience. If there is a member here who tells you his credentials and he is in good standing, I don't see the risk. Of course if you are gullible and believe your grandson is being held hostage in the Congo, Zelle might not be for you.

[Smoke4320]

Zelle fraud is rising. And banks aren’t coming to the rescue
https://www.cnn.com/2022/10/03/business/nightcap...
WebZelle, the popular payment app, is under fire for how it handles (or rather, doesn't …

Zelle faces surge in fraud and scams, Senate report finds
https://www.cbsnews.com/news/zelle-fraud-scams...
WebThe cases of growing fraud and scams at Zelle have been highlighted in previous …

The ‘Zelle Fraud’ Scam: How it Works, How to Fight Back
https://krebsonsecurity.com/2021/11/the-zelle...
Web“If a criminal initiates a Zelle transfer — even if the criminal manipulates a victim into

I am not is a fight or looking for one just pointing out that there is much potential to be scammed on Zelle and the banks are not/will not return your money. Its totally on you ..

[schutzen-jager]

zelle is also anti second amendment like paypal - USPS money orders are better, but have them verified ar post office before shipping, forgeries are becoming more common - i also accept personal checks from known members - in rare instance that checks bounce or have payment stopped contact USPS inspection service for mail fraud + at jurisdiction where ck. was sent from at local police + sheriffs dept for theft by deception possible felony or misdemeanor depending on amount - amazing how fast they pay up with police knocking on their door - do not know if this works in all states, but it worked for me when i did it -

[ohen cepel]

Smoke,
Odd, but your first 2 links are dead now. Took about 20mins it seems for them to take them down or something.........

[Zbench]

Like anything in life, buyer beware. However, if you know a few things about scams and how they are perpetrated, Zelle is completely safe. Some pointers:

1) never click on an actionable link in a text message out of the blue or an email. That goes for Zelle, Itunes, Amazon, Paypal, etc. ALWAYS log into your account from a computer you trust and see if the alert is genuine. It never is.

2) never, ever fall prey to scammers calling you telling you they need to reset your password. These are all BS, always, every time

3) never, ever feel pressured to send money to people who call or send you emails. Popular scams are you won the lottery and we need your banking information, your relative has been arrested and needs money to make bail, etc. These are always scams.

If you follow these simple advises, you will never fall prey to scammers. Scammers need you to interact with them for the scam to work. If you recognize that 99.9% of the time that you receive an alert that is an emergency that it's a scam, life gets very easy. Over the long weekend, I got two "warnings" from "Amazon" that my account was breached and I needed to click here to reset my password. Total BS. I didn't even bother to log in and check.

[fastdadio]

You folks can look into this one:
https://www.redvoicemedia.com/2021/12/gab-launches-gabpay-an-alternative-to-woke-payment-processors/
https://news.gab.com/2022/10/gabpay-the-paypal-alternative/
https://help.gab.com/article/gab-pay-overview
I don't use it or any other form of private digital funds transfer services.

[farmbif]

there is still nothing online quite like genuine us postal money orders, good as cash at any post office or bank

[downzero]

sorry but Zelle is a con man/scammers playground. Massive amounts of fraud and many many people have had their bank accounts drained with NO recourse. I would do a lot of research on this one

Yes but once you get a Zelle payment, it's over and there is no reversing it.


there is still nothing online quite like genuine us postal money orders, good as cash at any post office or bank

For the seller, yes. For the buyer, there's absolutely no protection if you don't send anything. Unless I know someone or they're an established business, I don't send money orders these days. Maybe years ago, but not now in the era of electronic payment.

[Zbench]

Not to mention the fact that they are not like checks and most USPS clerks don't check if you are the person on the TO line. If someone gets that, it's like cash. As good as gone.

As to Gab, reading it has me recalling back to the days of Gpal and our old friend Ben Cannon. Anyone remember that fiasco?

I've used Zelle for years without incident, BUT, as soon as Fednow is online and active, I will be using that instead.

[imashooter2]

Personal checks from people I trust and USPS money orders for me.

If someone won’t buy with those methods, then I miss the sale. As for buying for myself… There is nothing on this board I need enough to open a Zelle account.

[farmbif]

in my opinion there are no goods of any type or any amount of money that is worth it if you even suspect that the people you are doing business with cannot be trusted

[Winger Ed.]

My world is pretty simple. For on line purchases, I use a credit card.

Here, what little I've bought, I have always sent a check.
I offer a money order, but I say up front it will be a few days before I go the 15 miles into town to get one.
I guess sellers have realized I wasn't going to burn down my reputation here over some $20 item and my check
and their item usually crossed each other in the mail.

Of the things I've sold, if it's to a active, contributing member-
I've sent the items and told them to be sure it's what they want and then mail me a check.

The ones who's only presence here is selling or sucking up the good deals on S&S--- they don't get that deal.
Their stuff gets shipped after I get paid with a check, or MO.

[schutzen-jager]

there is still nothing online quite like genuine us postal money orders, good as cash at any post office or bank

counterfeit USPO money orders have been coming more common in many areas - take them to post office for verification - if post office can not cash them [ many have only limited funds available ] your bank will -

[Scorpion8]

Regardless of how scammers use Zelle, it can be perfectly fine between people known to you or trusted by you. Using it doesn't mean its a scam, simply because it is Zelle. I have used it in the past between trusted recipients and it is perfectly fine. I use Zelle all the time to send money to daughters and it is quick, painless and works like a charm. Zelle is not the scammer, the person on the other end is. Blaming Zelle for scammers is akin to blaming your gun for killing.

[Electrod47]

Trust is something that has to be earned. With that said, I would imagine at least 98% of the guys here at CB are trust worthy. Not to mention probably 90% of the items offered here are less than a hundred bucks. I'v purchased several items here over the last few years. After contacting the seller they have all agreed to except my personal check, with the instructions to just mail the item when my check clears. I'v even added a little extra to cover shipping if I thought the quoted price was to low. This is a great place to pass on "kinda" hard to find items and I doubt anybody is trying to make a living at it.
Deal with people directly and they will trust you and you can trust them. Be patient with all and we will all get what we deserve.

[Handloader109]

I'll not touch zelle at all. Scammers paradise. While I might not like PayPal's politics, I can at least trust them as far as money is concerned, and I'm not talking about just here. Yeah, maybe not always on guns.... But I'll pretty much take a check or MO.

Sent from my SM-S908U using Tapatalk

[georgerkahn]

Just a thought or two: I love PayPal -- I may be one of few, but then again, how many users do they have? I've gotten burnt a good half-dozen times -- one at $782.00 USD -- and PayPal had MY money back in my account in literally minutes!!!
The way I see it, the #1 challenge now is for receivers of >$600.00 USD annually being subject to tax liability. Nothing I would even think of doing, but hey -- there's no reason why one cannot open a 2nd, 3rd, 4th,...."n" bank account -- say, one each in the different institutions in close proximity to them. UNLESS one accrues a fair interest amount annually, the bank issues no annual statement. So... if one wants to buy a, say, $2,135.96 item -- why not go to a "different" bank, open up a new checking account, and put, say, $2,141.00 in it? From the receiving end, a wise CPA once advised me a real "stupid thing" to do with a cheque is to deposit it into any account anywhere! If one simply cashes it...
Unless one is a company -- doing but casual S&S's -- keeping it simple -- with PayPal coverage -- is the way I go... (When you open a new checking account most all banks even give you a dozen or so cheques, free...)
geo

[Winger Ed.]

From the receiving end, a wise CPA once advised me a real "stupid thing" to do with a cheque is to deposit it into any account anywhere! If one simply cashes it.

I knew a guy like that. He had a small business that got a few rather large checks.
He'd go to one of those 'check-o-cash-o' places.
He logic was, 'I can pay them 5%,,,, or the IRS about 20%'.

[elmacgyver0]

I never buy anything that if the money disappeared, I would be hurting too much.
Stuff happens, case in point, I bought a set of walnut furniture for a FAL rifle from Ironwood Creations or something like that.
Something like $366.00, I will never see the stock and probably none of the money, the poor guy died of heart failure.
I mean what do you do? Stuff happens.
I hate losing the money, but it will not break me.
Stuff Happens.
There is a better word for stuff, but they won't let me use it.
You Know what I mean.

[contender1]

It doesn't matter if it's PayPal, Zelle, or any other electronic payment method. And this; "Fednow will be a quick, easy and free service sponsored by the Federal Reserve" is a US Government backed program.

Electronic types of money transfers,, can ALL be tracked, one way or another. And who wants to know about ALL your money? The Government. Why? They want more taxes. They want to track as much as they can so they can get their cut. They want to push this country into a cashless society. The more they know,, the more they can get.

I decided LONG ago,, to not use any form of electronic payment methods. I use a check or a USPS money order, or locally, cash!

Since the craze of "online banking, debit cards, electronic payment stuff, etc,," which my wife has accepted,, happened,, she's had her accounts hacked (3) times. And she's careful as she can be. But she prefers the "convenience" of these services.
Other than her paying her monthly bills, via a CC,, (which has protections,, and she pays the bill monthly to avoid fees,) I buy a lot more stuff online than she does. Yet,, I've never been hacked,, nor have I had to worry about it.

I don't use PP, I rarely use my debit card except to do ATM transactions, and I use a CC for stuff that require a card. I ONLY deal with companies I contact, and try to get them to accept a check if possible. But otherwise,, I refuse to do business with a company that I can't get solid info on that company. Due diligence of that company before I do business.
Otherwise,, it's checks, mailed from my PO, or USPS money orders I buy directly from my local PO.

And locally,, I pay cash for everything.

AND,, that can have advantages. Just today,, I had to pay a bill for services. The quote was over $6500.00. When I went to pay,, I asked; "BTW; Do you give a Veterans discount,, and if paying by cash?" The owner of this business said; "You are paying cash?" I replied "Yes." He sat down,, and re-figured my bill. He knocked off almost $600.00 off my bill. He said; "I LIKE people who pay cash!" And I've been in several restaurants that,, when paying cash,, I get a discount along with my military discount. Often,, that amounts to around 20% discount.

Sorry,, I'm smart enough to know when I'm saving money,, AND knowing the government isn't trying to get into my pocket for more than they deserve. You can keep Zelle, PayPal, Fednow or whatever. Not for me.

That's just my opinion,, and I know others may not agree. But it works for me.

[kerplode]

The way I see it, the #1 challenge now is for receivers of >$600.00 USD annually being subject to tax liability. Nothing I would even think of doing, but hey -- there's no reason why one cannot open a 2nd, 3rd, 4th,...."n" bank account -- say, one each in the different institutions in close proximity to them. UNLESS one accrues a fair interest amount annually, the bank issues no annual statement. So... if one wants to buy a, say, $2,135.96 item -- why not go to a "different" bank, open up a new checking account, and put, say, $2,141.00 in it? From the receiving end, a wise CPA once advised me a real "stupid thing" to do with a cheque is to deposit it into any account anywhere! If one simply cashes it...
Unless one is a company -- doing but casual S&S's -- keeping it simple -- with PayPal coverage -- is the way I go... (When you open a new checking account most all banks even give you a dozen or so cheques, free...)
geo

In the age of KYC compliance, doing this kind of stuff will raise a bunch of red flags and draw fed attention faster than just banking like a normal human. Opening a bunch of accounts, staging deposits, and moving money all around makes it looks like you're up to something (money laundering or other shenanigans) and it'll cause you to get noticed by the very people you're trying to "hide" from. And that $600 thing is more nuanced than what you probably think. It's aimed primarily at people actually operating a business. Those people are already subject to taxation on that income...The rule change is just requiring reporting. If you're just selling something here and there casually, then it doesn't apply (i.e. you don't owe tax). And it doesn't have anything to do with bank accounts. There was some proposal to that affect, but nothing changed. Not that it won't change in the future, but for now, business as usual.

I kinda see your point on depositing checks, but if you use your bank to cash it, they have visibility to its existence. At my bank, "cashed" checks are effectively deposited then immediately withdrawn. It becomes a distinction without a difference at that point. Most banks won't cash a check unless you have an account there, so then you're left going to the sketchy payday loan, check cashing places...This day and age, I'm not even sure that would be anonymous anymore.

One thing I know for sure, though, is NEVER use Plaid to establish links between bank accounts. It's insecure by its very nature and even worse, by using their service, you are granting them permission to harvest transaction data from the accounts in question.

I think the best bet is to just move into a cave and buy everything with wampum...

[kerplode]

And locally,, I pay cash for everything.


When I lived in CO, if you tried to pay for anything with cash, people would look at you like there was something wrong with you or maybe like you were up to something. They wanted nothing to do with it.

Here in podunksville, though, cash is king, baby! People's eyes get all wide and excited...and the discounts...oh the discounts...It's a beautiful thing!

[rockrat]

No problem with cash here in CO, where I live. Front Range/Denver area, yeah, I could see that.