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Jul 22

PayPal Chargeback Process – Time

Please beware, this is true story…

I sold something using PayPal about 4 months ago. It was our mistake that we had shipped the wrong product to the customer. After we received complaints, we requested proof (photo in this case) and tried to work with customer. He/She didn’t feel secure with the transaction and opened a dispute with credit card company (AMEX). At that point, we had already reached to an agreement and we had shipped a new product to customer’s address. However, the dispute became an international problem (sarcasm).

AMEX and PayPal started 80 days no-talk, no-action dispute resolution process. Customer had already received two products and I had made payments to manufacturer for both products. So I was tripple screwed. I called PayPal multiple times, hearing all their sorry voice and apologies but no result. Customer called AMEX 3 times, no result. So finally, I received an email today saying, PayPal was able to resolve the situation in our favour after 80 days of waiting.

However, PayPal didn’t do anything to resolve it, the reality of the situation is totally different then as they state in their email.

PayPal’s Chargeback process when a dispute issued directly with Credit Card company by a customer:

1-Customer calls Credit Card company and opens the dispute
2-PayPal dispute resolution center emails you and asks you for evidence
3-Upon receiving your evidence, PayPal sends it to AMEX
3.1-AMEX puts hold on any payment to PayPal
3.2-!!!PayPal waits for you to do one more transaction. As soon as you try to send money to somebody or make a purchase, they combine all the debt with that transaction and charge your credit card or bank account. As far as PayPal Chargeback Center told me, if you don’t make any purchase/transaction on PayPal account, they will for 90 days then start the collection process.
4-You are helpless. PayPal recovered her lost and that’s all they care about.
5-Phone calls to PayPal by me and AMEX by customer didn’t make any difference.

PayPal Chargeback – Dispute center clearly told me that after they submit the evidence to credit card company, it is all their decision and PayPal will have to go with that. I asked what PayPal could do if AMEX had decided to hold onto money after 80 days. They said, they would send a courtesy note to the customer on my behalf, to return the product or make another payment but that was all.

So, as an advise to fellow merchants who would like to use PayPal as a payment option, do not sell anything more then $100 worth or be ready to lose money. Paypal will not defend your rights or money.

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