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sciencefare

PayPal Buyer Protection vs PayPal Buyer Complaint Process

Beginning April 8, 2009 buyers who use PayPal for an internet purchase and have a problem with their transaction are being treated very differently now depending on WHERE they purchased the item. Buyers who use PayPal for their eBay purchase will be covered quite extensively no matter how they funded their purchase.

However, ecommerce buyers who purchase from any other non-eBay venue where third party sellers offer their wares, such as Bonanzle or Etsy, or from any individually-owned (including corporate) websites will have very little consumer protection unless the payment is funded with a credit card which affords the buyer the opportunity to chargeback their purchase.

Of course, there are a great many implications. Ecommerce buyers who use PayPal for internet purchases could experience greater fraudulent transactions and poorer customer service on non-eBay venues and ecommerce websites once sellers become aware that SNAD complaints have no real bite.

Buyers may end up trusting the other sites less but, also, as a result these ecommerce buyers may also trust PayPal less as well. And ecommerce buyers who use PayPal will be less willing to fund their PayPal purchases with anything other than a credit card which, in turn, will increase PayPal’s transaction costs. The number of chargebacks PayPal experiences will alsmost surely rise as well.

It is understandable why PayPal made the changes. PayPal provides buyer protection on eBay because eBay can suspend any seller who does not perform to an established set of standards. And with their Buyer Complaint Policy for non-eBay purchases, rather than Buyer Protection Policy, PayPal is now more in line with other payment processing services who do not provide guarantees or protections for the websites that accept the various payment methods.

While it makes sense that PayPal would make this change, I think PayPal has failed to inform and educate users. It is true that PayPal listed this change in their policy updates along with several other pages of policy updates but I don’t think it is nearly enough. I really think PayPal account holders should have been sent an email explaining this very important change in protection. Instead, some PayPal users are shocked to learn of the new policy only AFTER they experience a problem with a transaction.

To help better explain the differences, I have copied / pasted from the PayPal help pages and policy pages the following information about PayPal Buyer Protection and PayPal Buyer Complaint Policy:

Paypal Buyer Protection

PayPal Buyer Protection is a policy that can provide purchase protection for buyers on eBay. It helps eligible buyers recover funds from eBay sellers who do not deliver the promised goods, or who deliver goods that are significantly not as described in the listing.

Eligible buyers may, at PayPal’s sole discretion, receive a payment from PayPal or have funds recovered from sellers. The policy applies to transactions on eligible eBay websites and protects payments for most tangible, physical goods that can be shipped. Payments for intangibles, services, licenses, and other access to digital content are not protected.

Paypal Buyer Complaint Policy

It is PayPal’s process to help you resolve a problem directly with the seller through the PayPal Resolution Center for purchases that are not eligible for PayPal Buyer Protection.

The PayPal Buyer Complaint Policy is similar to...

Read The Rest From: TheBrewsNews

purple_reading_giraffe · Joined: 04 Feb 2008 Posts: 5488 Location: Indiana, USA

Seems to me that if PayPal wanted to do so, PayPal could institute account freezes and account suspensions for sellers using PayPal. They even have experience and infrastructure in place if they truly wanted to be the place for buyer trust. Might be for the best in the end, though, if we went back to caveat emptor.

sciencefare · Posted: Mon May 04, 2009 8:56 pm Post subject:

purple_reading_giraffe wrote (View Post): › docWrite("quote")Might be for the best in the end, though, if we went back to caveat emptor.Might very well be. :)

purple_reading_giraffe · Joined: 04 Feb 2008 Posts: 5488 Location: Indiana, USA

I have to think, though, that it surely would be nice to have a payment service that actually vetted vendors in some way. I know that PayPal has far too many loopholes to be that service, but still, one can dream. I'm not even sure how one would go about it - through verifying a business bank account? Well how hard is it to open a new one? A business bank account for a certain time frame? A cross-check of full identity information? How about smaller sellers? *sigh*

I'm not even sure if an internet buyer could determine if credit cards were being accepted through a reputable merchant service or not.

DaLizardsLair · Joined: 15 Feb 2009 Posts: 4783

So where's the change in their policy?

I've never known Paypal to support SNAD complaints outside of eBay.

And when you come to think of it, most of the time the transaction works out the way it should. The seller gets paid and the buyer gets what they paid for.

But being outside of eBay, the seller doesn't have to worry about having the buyer file a complaint and return something other than what was purchased, which happens frequently enough on eBay for it to be a problem.

For the buyer, if they fund their Paypal payment with a credit or debit card, they are still protected. They can initiate a chargeback if there is a problem and the seller won't make good on it.

In other words, it's more like real life...and isn't that the way it's supposed to be?