elgato
Joined: 24 Feb 2005
Posts: 17235
Location: Texas
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| Posted: Sat May 16, 2009 2:24 pm Post subject: Chargeback Processes: Amazon vs eBay and PayPal |
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More online sellers are becoming multi-channel and, as such, it is critical to understand the differences between venues so that you can know what to expect as a seller. Take, for instance, the issue of chargebacks. eBay sellers are treated completely differently than Amazon sellers when there is a credit card chargeback initiated by a buyer. Amazon sellers are considered “innocent until proven guilty” whereas eBay buyers are considered “guilty until proven innocent.”
Financial implications:
Amazon only takes the money back from sellers if the credit card company decides in favor of the buyer whereas eBay automatically deducts the funds from a seller’s Paypal account while the outcome is being decided. With eBay, that process could take many months during which time the seller does not have access to the funds in question. And, very importantly, PayPal admits that they do not always fight chargebacks. If PayPal does not think that a chargeback can be won they will not fight on the seller’s behalf.
Reputation implications:
Amazon only records a black mark on a seller’s record if the credit card company decides in favor of the buyer. Of course, the buyer can leave negative feedback and that opinion is one part of the performance measurement by which Amazon sellers are judged. In contrast, eBay automatically includes the dispute-in-progress in the “buyer dissatisfaction” rating. More than 5% dissatisfied buyers, as determined by buyers who leave negative feedback OR leave 1 or 2 DSR rating OR file a paypal dispute or chargeback, and a seller is restricted from selling on eBay.
Details of the Amazon Chargeback Process:
An email is sent with the subject line: “Your Immediate Response Required: Charge Dispute Inquiry”
Among other things, the email from Amazon includes the following:
“In order to respond to the credit card issuer on your behalf, we need you to provide us with proof of delivery, which we will provide to the credit card issuer.
By doing so, you will help resolve this issue faster for both you and your
buyer. “
In answer to the question of How will I know what the outcome of a chargeback is?
“The final outcome of a chargeback can take up to 90 days to be received from the date the charge was represented to the issuing bank. In rare cases, it can take even longer. We will inform you of the outcome only if you are held financially responsible for the chargeback. The e-mail notification sent regarding the funding decision will outline why you have been debited. Otherwise, you may assume that the information you provided was sufficient.”
Details of the eBay / PayPal Chargeback Process (as copied from the PayPal Help pages):
If a buyer files a chargeback against you for a credit card transaction through PayPal, we’ll email you as soon as we’re contacted by the credit card company.
The funds in question will be held temporarily, as we work with you to resolve the chargeback with the buyer’s credit card company.
We help you minimize the expense and hassle of chargebacks by building a case to take to the credit card company in instances where chargebacks can be fought.
The resolution process can take 75-100 days, depending on the credit card company.
If the credit card company decides in your favor, PayPal will immediately transfer the funds back to you.
Why the differences? Two main reasons:
more.. link to news article |
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