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 TearAbiteD'oh
join:2001-07-25
Rancho Cucamonga, CA
kudos:2 | reply to QuaffAPint
Re: Protect myself on a Paypal payment Using PayPal is fast and convenient, but dangerous compared to other payment methods... You have two things to worry about:
1) PayPal can decide to 'seize' your funds, on a whim, for virtually no reason. Check this blog-post:
»success.grownupgeek.com/index.ph···d-access
notice in that blog post all the comments from other people with the same issue! That post has links in it to a couple of "continued" posts.. read them.
2) Your customer can very easily screw you: Paypal gives you ZERO protection against chargebacks on non-tangible items (items you cant ship, like scripts). all a customer has to do is contact PayPal, say they never got whatever you gave them and THEY WILL get their money back. The only way around this would be to ship their script on a CD so you can have proof of delivery. | |
 Jafo232You Can't Spell Democrat Without Rat.Premium
join:2002-10-17
Boonville, NY | said by TearAbite:Using PayPal is fast and convenient, but dangerous compared to other payment methods... You have two things to worry about: 1) PayPal can decide to 'seize' your funds, on a whim, for virtually no reason. Check this blog-post: » success.grownupgeek.com/index.ph···d-accessnotice in that blog post all the comments from other people with the same issue! That post has links in it to a couple of "continued" posts.. read them. I have used paypal for almost 10 years, not once have they ever seized my account and I have tens of thousands of transactions. The thing people don't seem to understand is that ANY merchant provider can do this to you.
said by TearAbite:2) Your customer can very easily screw you: Paypal gives you ZERO protection against chargebacks on non-tangible items (items you cant ship, like scripts). all a customer has to do is contact PayPal, say they never got whatever you gave them and THEY WILL get their money back. The only way around this would be to ship their script on a CD so you can have proof of delivery. This is true, non-tangible goods never qualify for any protections. Myself, I have my paypal account linked to a small account and when I would get paid by someone I hardly knew, I would just withdraw the money via the paypal card and/or bank transfer (and take it out of the bank). If the person did a chargeback, well it would motivate Paypal to reverse it since they would have no funds to retrieve :P. Of course, you will lose your paypal account if you don't fund any reversals/chargebacks, but if at least it protects you from a huge chargeback.
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TearAbiteD'oh
join:2001-07-25
Rancho Cucamonga, CA
kudos:2
1 edit | said by Jafo232:I have used paypal for almost 10 years, not once have they ever seized my account and I have tens of thousands of transactions. The thing people don't seem to understand is that ANY merchant provider can do this to you. Oh.. well.. I've driven a car for 25 years an have never been in an accident - so then, based on your logic, i never will be, and neither will anyone else... Just because it's never happened to you does not mean that it wont happen to you tomorrow, or someone else..
and yes, any merchant provider can do this, however most other merchant providers have customer service that will not evade your questions, give you wrong information, etc..
It's just a warning... Now the OP is aware.. That's all.. | |
 jhboricuaExMod 2000-01
join:2000-06-06
Minneapolis, MN | reply to Jafo232
said by Jafo232:I have used paypal for almost 10 years, not once have they ever seized my account and I have tens of thousands of transactions. The thing people don't seem to understand is that ANY merchant provider can do this to you. Maybe so, but with a normal merchant account, as they are regulated by existing rules for financial institutions, you have some recourse to challenge stuff like this. With Paypal, you have NONE, as they are not regulated as a financial institution. If they decide on a whim to seize your funds, you have NO say on the matter, No appeals.
Case in point, a good friend of mine got laid off on February of this year. He worked at a business that bought/sold used phone/network gear. So he decided to do that on his own using ebay/paypal.
The first month alone, he sold over $7k on phone equipment that prolly cost him $1.5k to acquire. Being just 23, he was, as you would imagine, ecstatic, and started scaling up. Paypal, noticing the amount of payments he was receiving, send him an email telling him they needed to 'verify' that he was who he said he was, and he lived where he said he 'lived'. They also wanted his business info, you know, Federal Id, etc. He spent the next 2 weeks getting all that info relayed, including registering his business with the state, paying all fees, etc.
AFTER ALL THAT, one day all of a sudden, Paypal CLOSES his account and seized the funds in it. Their incredibly vague explanation was pointing to his credit report. They didn't explain to him what about it they based the decision on. They flat out told him there is no appeals process, no recourse. They REFUSED to send a written explanation too. Oh, and they are holding his money for 6 months, there's no recourse on this one either. It's a good thing I told him never to leave too much money in it, so there were only $200+ at the time.
At the time of this happening, he was selling between $500 and $1k almost on a daily basis. And NO COMPLAINTS from buyers. Needless to say, he is now in the process of setting his own e-commerce site.
I have my own paypal account which for the most part has not given me any headache, but I don't leave money on it at all. If you can, stay away from them, they have gone to the crapper specially since eBay bought them. Their claim resolution process plain sucks, as others have indicated. Despite what they claim, you have very little protection against scams compared to a merchant account.
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Jafo232You Can't Spell Democrat Without Rat.Premium
join:2002-10-17
Boonville, NY | reply to TearAbite
said by TearAbite:Oh.. well.. I've driven a car for 25 years an have never been in an accident - so then, based on your logic, i never will be, and neither will anyone else... And using your logic, everyone will have their Paypal account "seized"..
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