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Monday, May 30, 2005

What is moneybookers ?

moneybookers is a “money transmitter” that enables any business or consumer to send and receive payments both securely and cost-effectively.

Using moneybookers is like using a bank account with a switch (debit) card, but without the card. Because a credit card is not involved, nor a is it a credit system, no-one needs to trust you - demanding proof of credit-worthiness - nor can a bank draw you into (credit card) debt.

We at abelard.org use moneybookers, but we do not tell you to use this system. If you decide to do so, it is your decision, your choice and you are doing so at your own risk.

The moneybookers system can be regarded as analogous to e-gold, but your reserves are held in cash rather than in gold. However, for short-term transactions this may well not be a relevant consideration.

This is like dealing in cash, anywhere around the world, with added services.

How can I use moneybookers?

* Send money using email, from your credit card or bank account
* Make online purchases
* Receive money using email

With moneybookers, there is no bank or credit-card middleman when you make your net transactions, whether purchases or donations.

That is:

* no bank taking a cut from your vendor for each transaction (but also see How much will this cost?)
* no bank wanting the vendor to keep large sums on deposit
* no bank wanting your vendor to pay even more charges for ‘secure transactions’
(these last two are required for credit card transactions on the net)

Other advantages are

* low currency conversion fees
* low transaction costs.

Result:

you pay less and your recipient gets more

and, if you set up your moneybookers account using a link from this site, abelard.org benefits as well!
What happens when I use moneybookers?

Briefly,



* You upload funds to moneybookers, who hold it in an account for you. You can see the amount being held as soon as you log on to your moneybookers account. How long the money takes to show depends on your funding method. Credit card funding takes effect immediately, while bank transfers are dependant on the bank’s habitual delay of 3 to 5 bank working days.

hover/click for further details


* When you send money by email, the recipient receives an email informing them that funds are waiting for them. If the recepient does not have a moneybookers account, they will need to open one to receive the money you sent. The money is transferred from your moneybookers account to that of the recipient.

* The recipient can then choose whether to keep the funds within moneybookers, spend it with a company that offers moneybookers facilities, or withdraw the money. Withdrawals to a bank account are also liable to a banks’ habitual delay of 3 to 5 bank working days.

Why moneybookers?

After investigating many methods of transferring funds using the Internet, that are not backed by digital gold, we at abelard.org have chosen moneybookers as our preferred electronic value transfer (evt) method for trading with fiat cash currencies.

Of the evt methods using fiat currencies we surveyed, moneybookers was the only one that did not allow chargebacks; that is transactions with moneybookers are irreversible (“there is no charge back risk to worry about.”). moneybookers also provides an escrow service for enabling secure trading of goods.

moneybookers does not have the problems associated with using a credit card online, as described in credit card downsides.

Administrative stuff

“moneybookers operates an electronic money service that allows customers to send and receive payments. Their funds are held in their ‘online stored value account’ as electronic money, in accordance with the EU E-Money Directive. The balance of any ‘electronic money account’ is redeemable at any time, this redemption being made only in accordance with ‘instructions given using the moneybookers user interface’.”

Note that moneybookers does not act as a bank, neither paying interest nor providing loan or overdraft facilities.
security

* “We [moneybookers] use multiple layers of security to help protect transaction information.
o Moneybookers uses Secure Sockets Layer (SSL) technology to help protect user information against unauthorised access from third parties, loss and fraud.
o In addition, when a payment is sent using Moneybookers, the recipient won't receive sensitive financial information like the sender's credit card or bank account number.
o Our servers sit behind an electronic firewall and are not directly connected to the Internet, customer information is thus available only to authorised computers.”

hover/click for further details
* a user’s access to their moneybookers account is on a secure webpage, using a previously confirmed email address, a password and a Turing number entry to prevent automated password hacking.
* an email reply is sent when opening an account, with a code that you enter in moneybookers to confirm the email address given.
Because the user funds their account from their bank account, previously verified by the user’s bank, no further account verification is required unless you wish to move larger sums or use a credit card.
* moneybookers is a financial institution regulated by the Financial Services and Markets Act 2000 in the UK (FSA Register No: 214225) and the EU directive on electronic money.

hover/click for further details

moneybookers works like this … (detailed description)

1. You open an account online with moneybookers. They require name, home address, email address and date of birth. You also provide a password for your moneybookers account. You may change your password at any time.

moneybookers then set up an account for you in your country of residence.


hover/click for further details


2. When you are ready, you fund your account either by a bank transfer or by using your credit card.

* Bank transfer:
The first time you initiate this in moneybookers, they send you to a webpage giving details of their bank account in your country of residence.
(If you wish to make a transfer from a bank account in a different country than that of your domicile/address, for instance you live in Brazil but your bank account is in Portugal, email moneybookers and they will reply with details of a bank account in the same country as your bank.)
The transfer will take the bank’s usual 3 to 5 working days.

making the transfer from your bank

Using the moneybookers bank information, you then instruct your bank to make a transfer from your bank account to the moneybookers account, for instance, by post or by using your Internet banking facilities. A domestic inter-bank transfer is often free.

Very important: Together with the moneybooker bank information, you will be given a reference number (reference ID) to use when communicating with your bank. You must use this reference number/ID when making your transfer to moneybookers. I f you do not do this, your money will be lost in the ‘bowels’ of their system. Your money may be found again, but this could take some weeks or months.

When making the transfer, if you wish to make any plain language notes, be sure to use the notes box provided on your bank form. Never never put anything but the moneybookers reference number/ID in the reference box.


* Credit card:
You must first verify your credit card by sending copies of identifying documents, listed here, to moneybookers. You can also verify your credit card by making a small payment from its associated bank account. (This payment will be credited to the associated bank account.) Once your card has been verified, you can use it to upload funds. Uploading funds using a Visa or a Mastercard costs 3% of the funds uploaded. The transfer of funds is immediate.


hover/click for further details


3. When you wish to withdraw/transmit funds from your moneybookers account, you can

* give moneybookers details of any bank account to which you wish to transfer (withdraw) funds from your moneybookers account online. Then you can transfer money from your moneybookers account to that bank account.
This is very useful if you wish to transfer money cheaply from one country to another (like Portugal and Brazil). The fee charged is a “withdrawal fee”, and depends on the withdrawal method used and the country to which the funds are transferred (withdrawn), but will not be more than 3.50 euro.
If your moneybookers account is held in, say, euros but you wish to witthdraw the money in pesetas, this is possible with moneybookers (providing that you hold bank accounts in more than one country).

* email funds to someone,
o maybe to pay for a purchase,
o maybe to make a donation,
o or give a present (or some other transaction).
The ‘someone’ might be an individual or an entity such as a company trading on the Internet.
If it is an Internet trader that can accept payment through moneybookers, they will probably have buttons (and a form) on their site to intiate your transaction [for instance, see our transaction form].

Withdrawing money from moneybookers requires your reference number/ID and your date of birth.

changing currencies

moneybookers use the daily exchange rates as published by the European Central Bank plus a spread (fee) of 0.8% in either direction, considerably cheaper than the rates usually given exchange bureaus and banks (unless you hold accounts in more than one currency in the same bank).

To convert currencies using moneybookers, fund your moneybookers account in one currency, then use

* those funds to pay for goods in a different country. The funds concerned will be converted by moneybookers to the currency required by the merchant concerned.
* or withdraw the funds to a bank account in a different country. moneybookers will convert the funds to the currency of that bank account.


How do I set up a moneybookers account?
Click here!
It’s easy;
it’s fast – no credit check, that was done previously by your bank or credit card company;
an account is free – no minimum balance requirement.

How much will this cost?

* To receive money into your moneybookers account from any source is free.
* To send funds to someone else by email, through moneybookers, costs 1% (up to a ceiling of 0.50 euro), both domestically or internationally. [Note the recipient will need to set up a moneybookers account to receive the funds, if they do not already have one.]
* To put funds into your moneybookers account by bank transfer is free. The cost of other transfers you may make to your account goes up to a maximum of 3% (the cost depends on the method and country).
* To withdraw funds from your moneybookers account, you make a transfer to your bank account. This transaction costs from 1.25 € (euro) [approx. £0.86 or US$1.62] to 3.5 € [approx. £2.50 or US$6.60], depending on method and country.

A comparison of transfer methods and costs is provided here by moneybookers.

A recent cost comparison
An example of transfering £350 from Australia to the UK

* Using banks:
Australian bank charge of A$28 (£11.52) + UK bank charge of £7

* Using moneybookers:
funding moneybookers account charge of 0 +
withdrawal charge of €1.25

[all exchange rates in this section as at Feb 2005]
Final words

Transferring funds on the internet can be a fraught operation when moving relatively small amounts or when dealing with a smaller trader who, because of their size, is unable to obtain merchant status. The moneybookers system provides a relatively simple, as well as secure, method of making such transactions.

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