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Topic: Paypal - protection as a seller
Raven
Posts: 9511
Location: Melbourne, Victoria
Hi all,

Wondering if anyone has any advice to give to ensure you don't get screwed when selling items paid for using PayPal.

I'm currently having to sell a lot of arts supplies, and many of the payments come in via Paypal. While I haven't had any problems yet, the prospect of someone turning around and saying "it never arrived" or "this isn't what I ordered" and then having Paypal turn around and let the buyer keep both the item AND the money isn't a nice one. Same deal with credit card chargebacks - as a buyer can use either the credit card provider or Paypal. Is there any way with Paypal to tell whether a person used a card for a payment, to minimise the risk?

From what I can tell, Paypal accept AusPost delivery confirmation, but credit card providers want signature to say something was accepted. Are there any other things I should know about that people can give advice on?
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Phooks
Posts: 3238
Location: Brisbane, Queensland


Depending on your market those risks are usually minimal tbh, but PayPal does have a bad rep for holding funds arbitrarily for CC processing and generally f***ing over growing businesses so I'd encourage you to shop around for better merchant services/tools

https://www.reddit.com/r/Entrepreneur/comments/6ej4hb/startups_need_to_beware_of_paypal/

https://www.reddit.com/r/Entrepreneur/comments/6ntjfy/paypal_stripe_and_processing_risk/

Depending on how much you want to hedge I'd say a 10-15% PayPal surcharge would solve a lot of problems either way.


notgreazy
Posts: 823
Location: Other International

Agreed with Phooks. Paypal is notorious for screwing over business and freezing your account then demanding arbitrary proof.

I think signature is a must when dealing with paypal/buyers. Also never post to a PO box, ever. Do not accept aliases as names, you can limit to verified paypal accounts only (not 100% about this).

If you can process the credit card payments yourself through a third party, that's a much better method. At least with credit card agencies they will accept proof and not always side with the f***ing buyer.

f*** paypal, I'd rather lose more % than deal with them.
trillion
Posts: 4328
Location: Ballarat, Victoria
hey Raven i use Square & Adobe Sign, ditched PayPal a while ago
Herron
Posts: 370
Location: Brisbane, Queensland

There is a big difference between a large volume online retailer/subscription service than selling off some personal items. If they aren't personal items and it's part of a business then make sure you have a business account with paypal - that is how a lot of small business/sole traders get done with paypal. The business account does have more paper work/vetting to make sure you're legit and they know where to find you if you do the dodge.

Depending on how much you want to hedge I'd say a 10-15% PayPal surcharge would solve a lot of problems either way.

Surcharges are against Paypal's TOS and will get you suspended.

Send registered post or courier if you don't trust your buyers. Courier can be cheaper than auspost.

The processing services have the same catches and consequences. If you scale up fast with any of them then they are going to be cautious until they can trust you. Most of the Paypal issues I have seen have firstly been in the US; involve selling with a personal account; ramping up fast without speaking to Paypal first; dodgy digital products; pyramid/affiliate schemes; high refund rates. I've had buyers try and pull s*** with me but Paypal has always solved the issue fast and with common sense.

If you are selling on ebay then the confidence people get from Paypal can outweigh the negatives.
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