Report: EBay to Strengthen PayPal's Anti-Fraud Provisions

San Jose, Calif. EBay Inc. hopes to attract more online traders by expanding the protections available to people who use its PayPal payment service for transactions on eBay's Internet marketplaces, according to the Associated Press.

EBay executives said Thursday at the company's annual user conference that buyers who pay for items with PayPal will be eligible for full refunds, with no cap, if a seller fails to deliver an item as promised. Previously, a buyer's coverage was capped at $200, or $2,000 if the item's seller enjoyed a particularly good reputation on eBay, the report said.

EBay sellers who accept PayPal as a payment method — as nearly all of them do — will also get unlimited protection against a charge being reversed. Such reversals can happen if a buyer claims not to get an item, or if a payment is fraudulently made. Previously, sellers' coverage had an annual limit of $5,000, and applied only for shipments to the United States, Canada and the United Kingdom, the report said.

PayPal spokeswoman Sara Gorman said the changes, due to take effect this fall, reflect the service's increasing confidence in its ability to spot and block many fraudulent transactions before they occur.

The steps come as eBay is trying several measures aimed at making its auctions and fixed-price listings easier and safer to use. Recently, eBay revamped its feedback mechanisms and introduced new incentives for frequent sellers.