What does prepayment mean? Simply explained

What payment in advance means can be explained in a few words. The most important thing is that you should only accept this payment method from absolutely trustworthy providers

Payment in advance – what it means

Payment in advance is by no means a new procedure, even if you may be familiar with it from online stores or classified ads such as eBay. If you have wondered what prepayment actually means, you will find the answer here.

• One thing straight away: When paying in advance, the risk is very unevenly weighted. Only one party bears the risk: the buyer. The seller, on the other hand, is in the clear as they do not take any risks with this type of payment.

• For this reason, it is more than advisable for you as a buyer to find out exactly who you are dealing with in advance. With well-known sellers, the risk is kept within manageable limits. If, on the other hand, you are completely unfamiliar with the seller, you should definitely consider carefully in advance whether you really want to use this payment method. In most cases, online retailers also offer payment via PayPal as an alternative, which gives you significantly more security.

• If you accept payment in advance, you first transfer the amount to your contractual partner. They will only provide the agreed service once the money has been credited to their account. On the one hand, this procedure helps online retailers, for example, to protect themselves from customers who are unwilling to pay.

• On the other hand, paying in advance offers quite a few fraudsters a good opportunity to take money out of the pockets of bona fide buyers, for example with professionally designed websites. However, the supposed online store hides nothing but attractive appearances and tempting prices. The same naturally applies to supposedly particularly attractive offers on the various classified ad portals.

• It may therefore be safer to purchase the supposedly inexpensive item from a well-known supplier, even if it is perhaps a few euros more expensive there. At the end of the day, it will still cost you less than if all your money disappears into some dark channels with nothing in return.