I don't get it - how does Paypal work?

[PrettyCandles]

I'm just setting myself up a Paypal account (so that I can have an eBay addiction as well as my Mumsnet addiction). It seems that I can spend on my Paypal account without actually having any money in it? Is that so? How do they get their money from me in that case?

your paypal account is linked to your bank so it comes out of there

But they haven't asked me for any bank details.

You can link it to a credit card too. They will bill you for any money you've spent that ain't yours. You can set up an electronic account where they'll take it direct from a bank account or credit card, or send cheque etc. NOt worth spending what you haven't got though cos they charge fees on top.

But where does it say that? They haven't asked me for any financial info, just told me that I can spend £500 this month, despite having a balance of £0. This is confusing. It doesn't make sense that I should be able to spend what I don't have, but that's what they seem to be offering me.