I'm a Paypal seller and today a buyer transferred RM100 to my bank account instead of the agreed RM120. He only transfered the money 2 days after I confirmed the deal and gave him the bank account details. Upon questioning, he said either I send to him Paypal fund worth RM100 or wait another few days before sending me the RM20 balance. I'm suspecting a 3rd-party fraud where the money is from other people. What should I do?

Ask him to give proof of money transferred. If use CDM, ask for slip.

If using online, ask for captured screen of the transfer. Also check his name and account name use to transfer to you, match or not.

Don't transferred anything if cannot confirm.

You also can check his activity here... did he post to sell something somewhere.

Buyer pay full amount, then you ship goods.

Where's the problem?

The way the money is paid is really suspicious. Besides, he's quite new to this forum, only joined a few months ago.

very fishy, sounds almost certainly like a 3rd party fraud case.
I wouldn't transfer it if i were you...
in a few days you might see your name and your bank account somewhere in disputes calling you a cheater for not sending the "goods" after that person bank-in..