Somebody wrote to me this week and asked:

“I would also like to subscribe to Nick Laight’s “What Really Makes Money” but I have only used my credit card on High Street websites that I know are safe (Tesco, etc). How would I be protected if I gave out my details over the net to a site I know nothing about? I have heard of something called “PayPal” but again, I know nothing about it.

I hope you can answer my queries, as you can see I am a complete novice but I want to learn.”

I understand your concerns about paying with a credit card over the internet. The media has done a great job of making the world completely paranoid about spending cash online!

The truth is, as long as you are careful, you shouldn’t have any problems when you use your credit card to pay for items on the web. You just need to make sure that the site uses what’s known as a “secure server”.

For example, if I got to Nick’s site and click on the button that says “Click Here for a 30 Day Risk-Free Trial” then the resulting page is a secure page. I can tell this from 2 different things:

(1) The address of the website starts with https rather than just http. The extra ‘s’ means the site is secure…

(2) There is a closed padlock icon somewhere on browser program. In my case I use an Apple Mac so the icon is in the top right but with other internet browsers it could be towards the bottom or in the top left etc. Look around and you should find it somewhere.

Ok, so from those two signs we now know the site is safe.

Next, you asked about how you are protected if your credit card is used without your consent.

This happened to me recently where my card was used to buy mobile phone top-up cards online. I rang my credit card company and told them that the transactions were fraudulent and they sent me a form to sign. I returned the form and the charges were removed from my card.

I couldn’t figure out how anybody could’ve got my details as I rarely use my credit card for anything. I eventually traced it back to a transaction I made in Portugal back in May – which was the last time I ever used my card in a shop (i.e. not online).

Many people use PayPal to buy items from eBay and also from other marketers – Clickbank allows you to pay via PayPal, as do domain registration companies like GoDaddy.

Perhaps the main reason a lot of internet entrepreneurs use PayPal is to receive payments on their websites.

I would suggest that you do sign up for a PayPal account if you think you are going to buy a lot of things online and also if you think you will be selling online at some point.

Paying via PayPal involves using just an email address and password so that the seller never gets to know your credit card details. If you want to be extra careful it is probably worth getting an account just so you know that you are more protected.

In any case I think it’s a good idea that you get an account now so it is ready when you need it.