A few years ago, my sister, who lives in the UK, sold a musical instrument to a US buyer. She had listed cheque, Postal Order, and PayPal as her payment options. The buyer said he would send a Money Order for the funds. My sister assumed he meant a Postal Order and thought nothing more of it until she received a U.S. Money Order which she couldn't cash without paying huge fees to her bank.
Had they known about AuctionChex, the buyer could have sent the money order to AuctionChex, and my sister could have received PayPal, or a UK cheque. Alternatively, when she received this Money Order and realized the cost to cash it, she could have sent it to AuctionChex and had them send her a U.K. cheque (much cheaper).
AuctionChex (www.auctionchex.com) is a UK-based company that has been in business for over five years and has close to 20,000 registered users using their service to facilitate International payment transactions, many on a regular basis.
AuctionChex is not an approved eBay payment method, but this isn't surprising because they aren't a payment processor, so it's hard for eBay to classify. In owner, Eddie StClare's words, they are a "payment facilitator," like a currency converter that also does payment method conversions.
This is how it works:
One - The buyer sets up the payment through auctionchex.com and identifies the payment type he will be using (from the accepted list for his currency).
Two - As soon as the payment clears (same day for bank transfers, NoChex and PayPal) AuctionChex sends the payment you requested to the seller.
Three - The seller receives the payment in his local currency (which means it clears quicker) and your item is shipped.
The AuctionChex fees are generally based on the payment type the buyer asks them to send onto the seller (the exception is the e-money fee explained below):
- If AuctionChex has to mail the payment type to the seller (i.e. checks/cheques) the buyer pays 1.25 pounds, $2.50, or 2.50 Euros.
- If the buyer requests AuctionChex send a bank transfers in Euros (IBAN/IBC) the fee is 2.50 pounds, $5, or 5 Euros.
- For same currency transactions (i.e. GBP to GBP, or USD to USD) there is an additional fee of 2.5%.
- If the buyer sends their payment to AuctionChex using PayPal or NoChex, there is an additional fee of 3.5% (which they refer to as an "e-money fee" to cover the fees that these companies charge them to receive the payment).
They also make a small margin on the exchange rate as all currency converter services do. The current rates can be found at http://auctionchex.com/excalc-s.html and are comparable to bank exchange rates.
AuctionChex may not be approved by eBay, but they are approved by PayPal. They are authorized by PayPal ("PayPal Compliant") to accept PayPal for a financial services transaction. According to StClare, this is quite difficult to get and he is very proud of it.
Sellers seem to like AuctionChex particularly because (like the original BidPay) the buyer pays the fees, and there are no charge-backs. If a payment goes missing, they simply cancel it and reissue it. Since AuctionChex sent the payment, they can track it easily without requiring "proof" from either party.
AuctionChex can't identify if the payment is for an eBay item, or any other merchandise so they can't track how many eBayers still use their service despite not being officially approved. It is up to the buyer to put an identifying "tracker" with their payment which could be "college rent for Sally" or "framed photo print."
This also means that the PayPal fraud protection (if you use PayPal to pay AuctionChex) is not available for the transaction with your seller because the PayPal part was between you and AuctionChex, not you and your seller.
AuctionChex Escrow
In addition to currency conversion, AuctionChex also offers an escrow service in the UK. The Escrow process with AuctionChex works exactly the same as any other escrow service. The buyer pays AuctionChex, the seller ships item, the buyer acknowledges receipt of item, and AuctionChex releases funds to seller. The funds are held in a non-interest bearing account until the buyer acknowledges receipt or the waiting period (7 days after the item is received) expires.
StClare said, "There is generally no currency conversion required to enable an escrow transaction through AuctionChex, as transactions can be carried out in the buyer and sellers' local currency (GBP, USD or Euro)."
The cost for escrow through AuctionChex is 2.5% of the transaction amount (minimum £5 or $10), capped at £25 (or the currency equivalent). "We also act for non-auction transactions, such as a concert/festival tickets, web domain transfer, a private peer to peer transaction or any other transaction where the buyer requires a safety net," explained StClare.
AuctionChex - Currencies Accepted
AuctionChex will convert funds from different currencies and payment methods into any of the other supported currencies and payment methods. So, if you are in the UK and want to buy from a seller in the U.S. who only accepts U.S. checks and Money Orders, you pay AuctionChex using PayPal, a U.K. cheque, bank transfer, etc. in Pounds and then they send a U.S. check to the seller in U.S. dollars on your behalf. If you pay AuctionChex via bank transfer or PayPal, the check would be sent out the same day. If you send a U.K. cheque, they will hold it until it clears, and then send the funds on clearance.
There are four currencies AuctionChex can accept and convert: U.S. Dollars, Euros, Great British Pounds, and South African Rand. In the table below you can see all of the payment methods they accept and what they can send in that currency.
| Currency |
Payment method accepted |
Payments they can send |
| U.S. Dollars (USD) |
PayPal, USD check, Money Order |
PayPal, USD check (from E*Trade
Bank) |
| British Pounds (GBP) |
PayPal, NoChex, bank transfer,
GBP cheque, Postal Order |
PayPal, NoChex, GBP cheque (from
Natwest Bank) |
| Euros |
PayPal, bank transfer, Euro
cheque |
PayPal, bank transfer IBAN/BIC
(from Keytrade Bank in Belgium) |
| South African Rand |
Bank transfer from South African
bank only |
Bank transfer (from First
National Bank in South Africa) |
AuctionChex may be somewhat unknown to the masses, but they certainly have a niche carved out for themselves in the cross-border transaction and UK escrow business.
"Effectively all transactions are processed the day we receive payment," said StClare. This means buyers get the payment to the seller quicker, and therefore get their items shipped faster.
For more information about AuctionChex, go to http://www.auctionchex.com.
