What Is Escrow?
Online transactions are risky and come with pitfalls if you need to pay for goods or services. It is essential to protect yourself from fraud, whether paying for a used car as a one-off or making other significant purchases.
In order to protect yourself against incorrectly described items and other forms of consumer fraud, perhaps you should ensure your payment method provides you with additional security. Escrow provides a secure and safe way for you to make payments online that will give you the peace of mind you need to trust online vendors and make payments for goods safely.
The term escrow refers to a type of financial instrument in which a third party holds an asset or escrow money for two parties involved in a transaction. Often, escrow accounts include escrow fees managed by agents who hold the funds until they receive approval or until predetermined contractual obligations have been met. Assets such as securities, money, and funds can be held in escrow.
In other words, it is a process used by two parties in the course of completing a transaction in which there is uncertainty regarding whether one party will be able to satisfy their obligations. The use of escrow differs, depending on its context, including online transactions, banking, intellectual property, real estate, mergers and acquisitions, and law. Managed by third parties, such as escrow companies, escrow agents, and mortgage servicers, escrow accounts are held by a variety of participants.
Why Buyers Need to Use Escrow Services.
Many people struggle to spot fraudulent sellers online, and even those who make frequent online purchases often come across fake profiles and goods. Most commonly, individuals will ask for money upfront via bank transfer or even Google Pay or Paytm. Despite most people thinking they have complete coverage when using online payment providers such as Google Pay or Paytm, it's not always the case.
You are not likely to have much recourse if you enter into an agreement with a fraudster and money is transferred. If you received the goods in a non-as described condition or if something went wrong with the services or product you paid for, you might have to reclaim your money.
In addition, even if you are dealing with a credible seller, you may receive a product that has been inaccurately described, or you may receive an item that is significantly different than what was described. In this case, you may be left with goods you do not want.
When carrying out online payments for goods or services, you are expecting the seller or buyer to be transparent and honest, and you expect the products to be in good shape or as described, and to arrive in the condition they were described in. However, it is known that making payments online comes with certain risks since you are relying on strangers to conduct their business in a professional manner. Online shopping can make buying goods from any location fast and easy, but dealing with unknown sellers and encountering problems can be more challenging.
The Escrow system provides a safe and secure means of paying for goods online, and it protects both the buyer and seller against a variety of fraudulent behavior.
Why Sellers Need To Use Escrow Services.
In most cases, you're dealing with someone you don't know, especially when you're selling goods or services online, you should think twice about your risk, especially if the goods or services are highly valuable since you will generally be dealing with strangers.
By using an escrow service, the seller verifies the buyer’s identity and confirms the funding is there during the transaction. Once the funds have been collected by the escrow company or an agent, the seller will be notified that he/she can ship the item to the buyer. The seller knows that the buyer will be able to pay for the item, so they can ship the item to the buyer with peace of mind. It is essential for sellers to provide tracking details during this process. Using this information, the escrow company guarantees that the item is delivered to the buyer and the buyer cannot claim otherwise. As soon as the buyer receives and accepts the item, the escrow company or agent releases the funds to the seller.
Also Check: What role does Escrow play in preventing fraud?
Digital Escrow Service In India.
Digital escrow services are offered by many companies in India. Among the most trusted is Vouch.
Vouch’s Digital Escrow service is a transparent way for buyers and sellers to build trust and secure a clean transfer of product and payment. Sellers can feel assured that they will be fairly compensated promptly, and buyers will feel confident that their order will be delivered as expected and on schedule. If you ever come across a fraudster asking for OTP, asking you to scan a QR code, or asking you to click on phishing links, you can simply say no and ask him/her to proceed with the transaction through Vouch.
Buyer Protection - When you purchase something of high value from an entity you do not know, there are many risks involved. There is no way to determine whether an entity is trustworthy, and you may be defrauded. Vouch offers you the assurance you need when you make a purchase. We won't release the funds to the seller until you've received the item and are satisfied with the transaction. In addition, we ensure the Seller provides tracking information, as appropriate, for the transaction.
Seller Protection - Vouch ensures that, as a Seller, you’ll receive your money once you deliver the promised goods and/or services. You are taking certain risks when you engage in long-distance selling. Even if you sell to an individual or business within your neighborhood, you're still going to be dealing with someone you don't know. With Vouch's robust and trusted payment method, you'll never have to worry about selling to an unknown entity.
Check back here to learn more about Escrow and how to protect yourself from fraud.
Safety is not just about protecting your credit, debit card number, and UPI accounts. It's about having control of your money till you've received the product or service you bought online!
Now that we have you up to date on online safety, let's get your transactions secure on Vouch. It's just a click away.