Paypal and buyer/seller protection outside ebay

BrianShaw said:

Not trying to be argumentative or minimize your experience/opinion... but I was an expert witness for a friend's dispute. It was a matter of residual value assessment after an item was broken in transit, not a substitution of product issue. Ebay/Paypal was very straightforward in what they asked for in terms of information and proof, and then resolved the matter quickly to the satisfaction of both buyer and seller.

In another situation (my own, this time) I was dealing with a seller who offered an item that he could not send because he didn't possess it. After several email exchanges with the seller where there was no confidence that he could even get the part, I asked for a refund. He stopped replying to emails or phone calls. An ebay/paypal action was initiated for a refund and that was accomplished in less than 2 days. I don't think this guy was acting criminally, just too lax an attitude for my needs -- I couldn't wait until "whenever" to get my goods.

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Thanks for the examples Brian, but my question is really more about paypal outside ebay.

sandermarijn said:

Just did like you said, you're right, thanks. This means that as a seller you're protected from paypal fraud if you choose to be paid through the second tab (gift etc), if I understand the paypal terms correctly.

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I think this must be wrong - did you not mean to say that "as a seller you're NOT protected from paypal fraud if you choose to be paid through the second tab (gift etc)"

I cannot see them extending the protection if they don't get any fee for their services.

It's easy to call them, click on Contact (bottom of page), click Phone, then log into your account and it will generate your 'code', then call the number.

All things considered, I think Paypal is genius!

sandermarijn said:

Thanks for the examples Brian, but my question is really more about paypal outside ebay.

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My examples are examples of paypal protection, whenever it is offered. One needs to be sure to specify a form of paypal transaction that has protection connected to it if one wants to be protected. Then, in my experience, the protection works well.

sandermarijn said:

However, this may not mean you're free from a chargeback by the buyer's credit card company. Anybody know more about this?

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Oi, I really like quoting myself

Seriously, just to get this thread on the track I have in mind: anybody know how the credit card people enter this story? Are they capable of overruling paypal regardless of payment as gift and regardless of right or wrong (as defined by the paypal terms)?

Re credit card companies being able to charge back, never had the misfortune, if one sells/buys through Paypal's terms this should be a non-issue. If you had your own business selling coffee tables and a customer disputed the quality of the table that you sold, I bet, but could be wrong, your credit processing company would draft the chargeback to the merchant account. Paypal doest seem to be different in my opinion. A seller has an agreement with the as a clearing house, they are not the one at risk, the merchant (seller) is

BrianShaw said:

One needs to be sure to specify a form of paypal transaction that has protection connected to it if one wants to be protected.

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The irony seems to be that the seller is protected from buyer fraud only if a form a paypal payment (gift) is chosen that excludes protection.

It's either protection for both parties or for neither. In that case as a seller I'd prefer no protection at all. Once the money is in it's in (if it wasn't for those credit card companies?).

sandermarijn said:

The irony seems to be that the seller is protected from buyer fraud only if a form a paypal payment (gift) is chosen that excludes protection.

It's either protection for both parties or for neither. In that case as a seller I'd prefer no protection at all. Once the money is in it's in (if it wasn't for those credit card companies?).

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Well, that's exactly why I'm not much of a trader. There are few guarantees, and any "protection" is either limited, full of loopholes, or one-sided. That is the risk of being in the trading buisness, or trading hobby. Private party buying/selling involves a lot of trust and depends on both sides being sincere, honest, and honorable. Same with business transactions. There can be no guarantee of that, even in face-to-face situations it seems.

BTW, I've been using "Personal", "goods" when private-party buying and selling... only to find out from this thread that I should have read the Paypal TOS and known that there was no associate paypal protection. When buying I often pay via paypal with credit card, and if I have to eat the fees myself I do that in the hopes that if the transactiongoes awry I can get either paypal or the credit card company to help out. I really don't want to test that theory though because I could get a big and unpleasant surprise.

BrianShaw said:

Well, that's exactly why I'm not much of a trader. There are few guarantees, and any "protection" is either limited, full of loopholes, or one-sided. That is the risk of being in the trading buisness, or trading hobby. Private party buying/selling involves a lot of trust and depends on both sides being sincere, honest, and honorable. Same with business transactions. There can be no guarantee of that, even in face-to-face situations it seems.

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I am not much of a trader either, which is exactly why I'm looking for certainties where there are none.

Like you say, business is all about trust, just like with all other relationships between people. Hah, right forum after all

zsas said:

Re credit card companies being able to charge back, never had the misfortune, ...

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I have but it was in a direct purchase situation rather than via paypal. In all situaitons I believe they treat "chargebacks" like they do fraud -- credit the cardholder and write off the balance as a loss. I never had the impression that they really tried getting that money back from the bad sellers.

sandermarijn said:

The irony seems to be that the seller is protected from buyer fraud only if a form a paypal payment (gift) is chosen that excludes protection.
It's either protection for both parties or for neither. In that case as a seller I'd prefer no protection at all. Once the money is in it's in (if it wasn't for those credit card companies?).

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Finally somebody get that right. I have been making that case on other threads and at LFF. There is nothing dishonest for a seller to simply request a direct payment and pay only the Paypal fee related to the direct payment and not for the often abusive buyer protection. But the righteous type have always been harping that by not going the way of the full service and fee you are defrauding Paypal - BS - IMHO, you are paying for exactly the service that both party are accepting i.e. transfer of funds from one PayPal account to another, nothing more, nothing less (foreign exchange apart..).
It is a pity that no middle ground exists that would be equally fair to buyer and seller.
My last sell on eBay, the buyer was threatening to put a claim for item not as described even before the lens had reached Hong Kong unless the price was further discounted. This bothered me and when the buyer put a claim I sent the emails to PayPal showing the bad faith and the only answer I got was a charge back...
Regretfully it is not always possible to deal only with long time forum members instead of total strangers with no feed-back.

Cheers,

Luc

lbenac said:

Regretfully it is not always possible to deal only with long time forum members instead of total strangers with no feed-back.

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Even that is no guarantee.

sandermarijn said:

The irony seems to be that the seller is protected from buyer fraud only if a form a paypal payment (gift) is chosen that excludes protection.

It's either protection for both parties or for neither. In that case as a seller I'd prefer no protection at all. Once the money is in it's in (if it wasn't for those credit card companies?).

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Sorry, this is incorrect.

If a buyer describes the transaction as a purchase of goods, then the transaction is eligible for seller's protection. In order to invoke that protection, the seller must ship to the buyer's confirmed (or verified) address and (for sales above $250.00 for Canada) obtain delivery confirmation.

If the buyer describes the transaction as a gift or sale of other, non-eligible items/services, then the transaction is not eligible.

In order to insure the buyer describes the transaction properly, it is best to send a PayPal invoice to them.

If a seller receives a properly described payment without having issued a PayPal invoice for it, one can use PayPal to create a shipping label. In any event, the transaction details associated with the payment received notification indicate whether or not the transaction is fully or partially eligible for seller protections.

I've done this a few times for sales through APUG. Each time the PayPal information indicates eligibility.

The buyer protections are different.

MattKing said:

In order to insure the buyer describes the transaction properly, it is best to send a PayPal invoice to them.

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That, Matt, is my most significant lesson of the day.

MattKing said:

In order to invoke that protection, the seller must ship to the buyer's confirmed (or verified) address and (for sales above $250.00 for Canada) obtain delivery confirmation.

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That should be "online delivery confirmation".

If I send to the US (or any other country IME) with Netherlands' only consumer-oriented shipping company (TNT), then there will be delivery confirmation but not online. This is no big issue for me, but it is to paypal.

Once I had to send back to Luxembourg an ebay-purchased 400 euro camera. Paypal demanded I use online confirmation, which forced me to use DHL instead of TNT, raising the cost by about 50 euros. This extra money was not refunded by the seller until after I had to repeatedly contact him.

Shipping companies must love paypal!

MattKing said:

If the buyer describes the transaction as a gift or sale of other, non-eligible items/services, then the transaction is not eligible [for seller protection].

In order to insure the buyer describes the transaction properly, it is best to send a PayPal invoice to them.

If a seller receives a properly described payment without having issued a PayPal invoice for it, one can use PayPal to create a shipping label. In any event, the transaction details associated with the payment received notification indicate whether or not the transaction is fully or partially eligible for seller protections.

I've done this a few times for sales through APUG. Each time the PayPal information indicates eligibility.

The buyer protections are different.

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Yes, the buyer protection terms are different, but the question should be: "how are they different?".

The way I read paypal's terms,

To be eligible for PayPal Purchase Protection you must meet all of the following requirements:

- Pay for the eligible item from your Account.

- Pay for the full amount of the item with one payment. Items purchased with multiple payments – like a deposit followed by a final payment – are not eligible.

- Send the payment to the Seller through:

* the eBay “Pay Now” button or the eBay invoice; or

* the “Send Money” button of your Account by selecting “eBay Item” and entering your eBay User ID and the eBay item number for purchases on eBay website; or

* the Send Money tab on the PayPal website, by clicking the “Purchase” tab, or by selecting the “Checkout with PayPal” button or otherwise selecting PayPal as part of a Seller’s checkout flow.

- Open a Dispute within 45 Days of the date you sent the payment, then follow the online dispute resolution process described below under Dispute Resolution. For Pay After Delivery transactions you must open your Dispute within 45 Days of the date of your transaction.

- Have an Account in good standing.

... the buyer is protected as soon as he signs a seller's invoice (provided it is of the "purchase, goods" type), according to the boldened piece of text above. IOW as soon as the seller is protected, so is the buyer. And if the buyer isn't protected then neither is the buyer. My argument is that despite the terms for buyers and sellers being different in wording (for obvious technical reasons), the seller- and buyer protection schemes have equivalent conditions.

Therefore, in my understanding, my previous statement: "The irony seems to be that the seller is protected from buyer fraud only if a form a paypal payment (gift) is chosen that excludes protection", holds, also if you send the buyer an invoice with the purchase named as a purchase of goods (as opposed to the gift-option). It is my interpretation of paypal's buyer protection terms (see above) that by the act of the buyer clicking the "pay"-button in the seller's invoice, both are automatically protected.

IMO, the only way to protect yourself as a seller from paypal's buyer protection is to choose the gift-option, in which case neither party is protected (read: the seller gets his money, the buyer will have to hope for the best). Of course, if you choose not to send an gift-invoice, you will have to ask the buyer to mark his payment as gift.

One caveat: I still don't understand how far the power of credit companies stretches. And I am under the impression that nobody who has participated in this discussion so far understand this part either. (Just provoking you guys a bit )

lbenac said:

Finally somebody get that right. I have been making that case on other threads and at LFF. There is nothing dishonest for a seller to simply request a direct payment and pay only the Paypal fee related to the direct payment and not for the often abusive buyer protection. But the righteous type have always been harping that by not going the way of the full service and fee you are defrauding Paypal - BS - IMHO, you are paying for exactly the service that both party are accepting i.e. transfer of funds from one PayPal account to another, nothing more, nothing less (foreign exchange apart..).
It is a pity that no middle ground exists that would be equally fair to buyer and seller.
My last sell on eBay, the buyer was threatening to put a claim for item not as described even before the lens had reached Hong Kong unless the price was further discounted. This bothered me and when the buyer put a claim I sent the emails to PayPal showing the bad faith and the only answer I got was a charge back...
Regretfully it is not always possible to deal only with long time forum members instead of total strangers with no feed-back.

Cheers,

Luc

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Not sure I'm getting it right, but I do believe so. And I agree 100% with what you write, especially the part "There is nothing dishonest for a seller to simply request a direct payment and pay only the Paypal fee related to the direct payment and not for the often abusive buyer protection."

Paypal is an online company, I can see why they would require a trackable online verification, I think your issue is with TNT and displaced towards Paypal. It probably would cost Paypal more than it is worth to set up a mail center to receive letters with shipping receipts for carriers like TNT and match them up to online disputes. Paypal is an online co and it makes sense their dispute claims employees wd do verification online, the volume must be large to begin with. TNT needs to upgrade its practices. I bet that 90% of shippers have online verification, should PayPal spend the money to downgrade their process for the 10% or should the 10% upgrade? (note my stats 90% v 10% is a guess).

Are you saying that if you sell an item and it has buyer and seller protection avail, the seller protection does not protect against buyer fraud and the only way to protect the seller is to do "gift" which then removes the buyers right to buyer protection?

Several years ago I had a dispute with an eBay seller. I ordered an item through buy-it-now, and paid through PayPal. The item never arrived. I contacted the seller, and there was excuse after excuse for the delays. Foolishly I waited until the last possible day to open a dispute. Trying to give the seller the benefit of the doubt, I opened a dispute on the last day, only to be informed by PayPal that the time limit runs to the minute. Since I had purchased the item at 5:00 pm and placed a dispute at 5:03 pm it was denied, as I was over the time limit.

I informed them that I was going next to my credit card company, and it didn't seem phase them a bit. I filed a dispute with the credit card company, and the charge was reversed.

PayPal never complained or said a word to me. Six months later, the item I originally ordered showed up. (With a very recent postmark.) To this day I do not know who came up short the money. I was never contacted for payment by PayPal, or the original seller. I even got positive feedback from the original seller.


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zsas said:

Paypal is an online company, I can see why they would require a trackable online verification, I think your issue is with TNT and displaced towards Paypal. It probably would cost Paypal more than it is worth to set up a mail center to receive letters with shipping receipts for carriers like TNT and match them up to online disputes. Paypal is an online co and it makes sense their dispute claims employees wd do verification online, the volume must be large to begin with. TNT needs to upgrade its practices. I bet that 90% of shippers have online verification, should PayPal spend the money to downgrade their process for the 10% or should the 10% upgrade? (note my stats 90% v 10% is a guess).

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The issue arises if you ship to a country for which no signature or tracking is available through your postal service.

zsas said:

Are you saying that if you sell an item and it has buyer and seller protection avail, the seller protection does not protect against buyer fraud and the only way to protect the seller is to do "gift" which then removes the buyers right to buyer protection?

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Regretfully, that is pretty much the case.

I think the easiest way is to only deal with established forum users here on APUG or elsewhere. Ebay's system, while sometimes frustrating, is fairly good at working these things out. Out here in the wild, I tend to deal with people I know.

zsas said:

Paypal is an online company, I can see why they would require a trackable online verification, I think your issue is with TNT and displaced towards Paypal. It probably would cost Paypal more than it is worth to set up a mail center to receive letters with shipping receipts for carriers like TNT and match them up to online disputes. Paypal is an online co and it makes sense their dispute claims employees wd do verification online, the volume must be large to begin with. TNT needs to upgrade its practices. I bet that 90% of shippers have online verification, should PayPal spend the money to downgrade their process for the 10% or should the 10% upgrade? (note my stats 90% v 10% is a guess).

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TNT is all I have. And yes, I feel that offline-tracking (I send paypal an email with the proof of delivery/signature attached) should be accepted, even in 2012.

Just to be clear, this thread is not about me having an issue with paypal policy per se, it is about my lack of understanding of it.

zsas said:

Are you saying that if you sell an item and it has buyer and seller protection avail, the seller protection does not protect against buyer fraud and the only way to protect the seller is to do "gift" which then removes the buyers right to buyer protection?

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Uh, yes?

Mind you, I did not invent paypal and their terms. I am just being critical towards a process that I do not fully understand and that I wish to learn more about.

Again, this is not (necessarily) a paypal bashing thread. Rather it is a request for information that will allow me to form an opinion on whenif I want to use paypal.

ambaker said:

I informed them that I was going next to my credit card company, and it didn't seem phase them a bit. I filed a dispute with the credit card company, and the charge was reversed.

PayPal never complained or said a word to me. Six months later, the item I originally ordered showed up. (With a very recent postmark.) To this day I do not know who came up short the money. I was never contacted for payment by PayPal, or the original seller. I even got positive feedback from the original seller.

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My initial suspicion was that credit card companies have lots of power to chargeback (if that's a word). Your story and that of someone else in this thread so far confirms my supicious attitude.

Perhaps it's for a reason that paypal themselves in their terms state how powerless they are towards credit card companies (link):

"13.7 Relationship between PayPal’s protection programs and Chargebacks. Credit card Chargeback rights, if they apply, are broader than PayPal’s protection programs. Chargebacks may be filed more than 45 Days after the payment, may cover unsatisfactory items even if they do not qualify as SNAD, and may cover intangible items. You may pursue a Dispute/Claim with PayPal, or you may contact your credit card company and pursue your Chargeback rights."

Good that you got your money back!

If you sell an item and the buyer pays via "goods" then both are protected. So if you follow the rules (ship tracked, to their address, confirmed if over $250 (US policy, different amts may apply per country), abd the buyer claims to have never received the item, yet you have this proof, how would you not be protected against buyer fraud? I don't believe Paypal would return the payment so long as you followed the terms (ie Seller protection). Your issue seems to be the terms are more expensive to implement bc TNT is not sig delivery proof via online? If a buyer claims the item wasn't described as advertised and claims that...well that is a different matter that is evaluated in a case by case basis, it isn't fair to say the Seller will always lose the dispute.

zsas said:

If you sell an item and the buyer pays via "goods" then both are protected. So if you follow the rules (ship tracked, to their address, confirmed if over $250 (US policy, different amts may apply per country), abd the buyer claims to have never received the item, yet you have this proof, how would you not be protected against buyer fraud? I don't believe Paypal would return the payment so long as you followed the terms (ie Seller protection). Your issue seems to be the terms are more expensive to implement bc TNT is not sig delivery proof via online? If a buyer claims the item wasn't described as advertised and claims that...well that is a different matter that is evaluated in a case by case basis, it isn't fair to say the Seller will always lose the dispute.

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Almost all if not all vendors that have had this issue reported that PayPal sided toward the Buyer. Some of these sellers are forum members that I would trust without any hesitation.