How does Paypal work? Do sellers have to sell their products before receiving the money?

-How is paypal secure? I've heard that Paypal is the most secure way of buying online. But my cousin told me she had been scammed before by using Paypal on Ebay.The seller never shipped her the product even though she won and paid the bid. She said that she was paying with the balance in her paypal account. She learned that you should always pay through your credit card instead of your paypal balance? Why is it more secure paying with credit card than pay pal balance? And do sellers have to ship the product before they can recive the money if the buyer was paying with credit card? how about paypal balance?If your cousin was scammed - she should have contacted PayPal/Ebay and complained -

PayPal is more secure because the "seller" does not have access to your credit card information. Payments from your credit card are made to PayPal - and PayPal in turn pays the seller - PayPal assumes that the seller is selling in "good faith" and that you receive your merchandise - unless you contact them and tell them different -- since you are using your credit card via PayPal - all "credit card"

guarantees apply -- but multiple vendors(sellers) do not have access to your credit card info --

much safer --