With more than 18 million users, eBay is the country’s largest online marketplace.
Buyers get to browse a vast range of goods and snap up bargains. Sellers use the site to do anything from disposing of unwanted goods for a few pounds, to showcasing all the products of their thriving businesses.
But eBay is not without problems, as countless letters and emails to Telegraph Money attest.
Buyer’s grievances include being sold stolen goods, or goods arriving not as described, while sellers complain about eBay’s protection schemes not working in their favour. And customers on both sides frequently comment on eBay’s poor customer service.
And thanks to the explosive growth of eBay and its rival sites, other, wider problems are emerging, such as users’ uncertainties over tax.
Pitfall one: eBay's buyer protection scheme
The “Money Back Guarantee” scheme, which launched in 2013, is by far the most complained-about issue found in our postbag.
The policy promises to refund the buyer with the cost of an item if it does not arrive or is not as described. If such a refund is made the seller has the money deducted from their account.
Needless to say, our complaints are from sellers.
EBay says the guarantee “ensures buyers can shop confidently, with knowledge that they will receive the item they purchased or their money back”.
The spokesman continued: “Sellers benefit from initiatives such as our Power Seller programme, which gives sellers who have built up a strong track-record of positive sales on eBay seven days to put right customer complaints before negative feedback can be left.”
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But many readers have reported being left out of pocket as a result of eBay’s “favourable” stance towards buyers.
In once case, Matthew Wright (pictured top) lost £160 and was locked out of eBay indefinitely after he sold a phone to a buyer in Hungary who claimed he didn’t receive it. This resulted in eBay automatically refunding the buyer under the guarantee scheme and passing the cost back to Mr Wright, without investigating the matter. EBay later waived the fee – but failed to explain adequately why it had been so quick to favour the buyer.
Following the publication of Mr Wright’s story, dozens of other sellers described similar instances of being “unjustly penalised”.
Helen Hickman (pictured below) uses eBay to sell surplus stock from her baby shop in Buckinghamshire. She encountered her first troublesome buyer last year, after selling a brand-new, sealed pushchair for £199.99.
Shortly after receiving the item, the buyer emailed Mrs Hickman saying she wanted to return the pushchair because she “didn’t need it any more”. This was just within the 14-day period during which a buyer can receive a refund – provided that the goods are in the same condition as when sold.
An automated message from eBay a few days later was sent to Mrs Hickman stating that the buyer had to be refunded, despite the fact that Mrs Hickman had yet to receive the returned pushchair.
After calling eBay to dispute its insistence that she should pay without having received the item, eBay said it would investigate the matter.
The following day Mrs Hickman received the returned pushchair “covered in mud, with stones in the tyres and baby sick on the fabric”.
After receiving the damaged goods, she took pictures and spent more than two hours on the phone trying to get through to eBay to explain things. But five days later, the case was formally closed in favour of the buyer.
When Telegraph Money intervened, a spokesman for eBay said: “As a marketplace, we do not have physical possession of the item at any time, so we have to use the information we have available in order to make fair decisions.”
The spokesman added that eBay had invested “millions of pounds” and dedicated thousands of people to ensuring that buyers and sellers could trade safely on its marketplace.
“We regret that in this case we did not live up to our usual high standards,” he said. “We do have to make difficult decisions that balance the interests of both parties, and we are sorry to hear of these isolated cases.”
Most recently, our consumer champion Jessica Gorst-Williams helped a reader who sold a yellow Liverpool Football Club shirt, signed by Luis Garcia, for £57 on eBay. The buyer then said he wanted to return the shirt in exchange for a full refund, but the shirt that was delivered back to the seller was a child’s red Liverpool FC shirt, not signed and with no authentication certificate.
At first, eBay refused to side with the seller, but eventually accepted that the buyer appeared to be manipulating its Money Back Guarantee by returning a different item.
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Pitfall two: customer service failings
Telegraph Money readers often complain of their difficulties in contacting eBay and getting it to resolve problems. Emails go unanswered and calls are handled by “unhelpful” advisers.
A quick look at eBay’s own user forum highlights the frustrations customers face, with one user stating: “[eBay’s] customer service department is an absolute joke – they are rude, abrupt, evasive ...”
Another simply condemns eBay’s service as “rubbish”.
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A spokesman for eBay said that the “vast majority” of transactions go smoothly, but that it was “always sorry to hear about the few cases where our customers were not happy”.
He said: “In the small number of transactions that experience a problem, eBay is able to intervene and successfully resolve almost all of these cases. In fact, we spend millions of pounds a year on cases where eBay refunds both the buyer and the seller and we’re always looking for new ways of protecting both parties.”
Pitfall three: sold stolen or fraudulent goods
While this is not a hazard exclusive to eBay buyers, as the largest online auction site in the UK, several of our readers have reported falling victim to scams on eBay.
John Bell from Edinburgh bought a Vietnam War American army GI wristwatch costing $55 (£35) but soon realised it was counterfeit when the glass fell out and he opened the watch up.
The seller refused to refund Mr Bell, and eBay said that "because your case has been closed for more than eight months, we are unable to take any action.” Only after our consumer champion Jessica got involved, eBay agreed to refund the original purchase price.
Fake mobile phones are also sold widely on eBay. A reader from Wiltshire bought a new iPhone 4 for £249.99, with a warrantee, on eBay from a firm based in Hong Kong. The phone became faulty after four months and would not turn off.
When the reader notified the seller, he heard nothing back.
After our consumer expert interceded, eBay acknowledged that the seller had a legal obligation to honour the guarantee that was offered. A spokesman for the company said it would conduct a review into the seller’s account to find out why this did not happen, and refunded GF’s money as “a gesture of goodwill”.
EBay said that fraud was an industry-wide problem. “We invest in the latest technology and devote thousands of staff to ensuring criminals learn the hard way that platforms like eBay are vigilant and proactive in fighting fraud. As a result of improved protection technologies, we’ve been able to reduce fraud on eBay to an all-time low, cutting it by 50pc in recent years,” a spokesman said.
Pitfall four: uncertainty about tax on earnings
Telegraph Money recently disclosed that thousands of online sellers who use websites such as eBay, Etsy, Amazon and Gumtree are the focus of new attempts by HM Revenue & Customs to crack down on tax evasion.
The taxman has sent 14,000 letters to traders suspected of running a business and failing to declare this on their tax returns. Some of those targeted make as little as £100 profit online. However small, any earnings above an individual’s tax-free personal allowance – £10,600 for the 2015-16 tax year – are taxable if the money made is considered a business profit, and should be declared in a self-assessment tax form.
If you sell second-hand items on eBay, for instance, you could be classed as a business by HMRC if it can prove you are doing “anything in the nature of trade”.
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