Hello,

I am currently running a web hosting company and i have a few questions that i recently ran into. I had someone file a chargeback for their hosting today via paypal. What can i do, to protect myself, when it comes to paypal chargebacks. What information should i supply paypal with that will benefit myself so that i dont loose funds, because this person ordered a domain name too, so i already paid for that...

Thanks
Ryan

Hello,

I am currently running a web hosting company and i have a few questions that i recently ran into. I had someone file a chargeback for their hosting today via paypal. What can i do, to protect myself, when it comes to paypal chargebacks. What information should i supply paypal with that will benefit myself so that i dont loose funds, because this person ordered a domain name too, so i already paid for that...

Thanks
Ryan

You are going to hate to hear this but we're to the point now where we just stopped responding to these notices. I simply delete them and we let PayPal do it's thing.

We used to spend countless hours building our "case" to submit to PayPal only to receive the same generic answer every single time.

Let me know if you find a method that works!

not really what i wanted to hear...

any advice on building cases against them?

Can't you just inform paypal that the payment was for intangible goods? AFAIK, they aren't covered...

Kevin

Try calling them instead of or in addition to writing.

Try calling them instead of or in addition to writing.

Phone works well for everything but cases, let us know how it works out. PayPal in general just does its thing, and a lot of customers who get paypal accounts are kids who file claims willy nilly. We just refund them and take the hit if it's nothing serious or if their claim isn't that outrageous.

Hello,

After a long talk with paypal today, I did learn that since I am selling "virtual" goods, they dont offer seller protection. However, I am Very Glad I made that call. I may have lost $50.00 but I learned a valuable trick from the operator i spoke with. What she recomended was sending some sort of good. I asked her if i sent a CD containing a manual on how to use the services i provide along with a invoice with the username and password for the server, she told me that would work. So, I have decided for order over $30.00 to send out a invoice and manual to that persons home address. I will also send them their login information via Email, so that they get it fast, just like any other host. This way, I can provide tracking for the item, and the chargeback is no longer under my belt, it is paypals problem!

Was it a chargeback or a PayPal dispute? PayPal disputes are simple to fight for service based purchases (such as web hosting), while chargebacks initiated from a credit card company and relayed through PayPal are near impossible to fight.

It was a dispute.

Sorry for the Mis-Clarification

Was it a chargeback or a PayPal dispute? PayPal disputes are simple to fight for service based purchases (such as web hosting), while chargebacks initiated from a credit card company and relayed through PayPal are near impossible to fight.

Was it a chargeback or a PayPal dispute? PayPal disputes are simple to fight for service based purchases (such as web hosting), while chargebacks initiated from a credit card company and relayed through PayPal are near impossible to fight.

Please explain. We lose atleast 3 disputes a month totally over ~$100 per dispute likely.

Care to share your secret that makes fighting PayPal disputes "simple"?

Nice little note about the mailing of the invoice and CD. That's a nifty little trick! Would that not run you more $ per month then the odd dispute though?

I am only sending it out for the Orders totaling more than $30.00
It will cost me about $5.00 to send it so i will profit $25.00 still, with slim chance of a dispute running on their side.
Would that not run you more $ per month then the odd dispute though?

I am only sending it out for the Orders totaling more than $30.00
It will cost me about $5.00 to send it so i will profit $25.00 still, with slim chance of a dispute running on their side.

Nice work. Good job! I don't wish a dispute against anyone but I'm curious to see if this works ;) Keep us updated.

I have only been using PayPal for about a month now. I have been using CCs for almost 8 years and now decided to get Paypal setup.

I just ran into my FIRST issue today with Paypal. We charged a client a few days ago for a hosting signup and yesterday a reversal was put in as "Unauthorized". I called Paypal to try to see what info they needed to verify the order but they said the case was already closed and the money was already taken and given back to the account holder. This baffles me considering Paypal won't even let me respond to a dispute. Isn't there a rebuttal period or something that is offered?

You are going to hate to hear this but we're to the point now where we just stopped responding to these notices. I simply delete them and we let PayPal do it's thing.

We used to spend countless hours building our "case" to submit to PayPal only to receive the same generic answer every single time.

Let me know if you find a method that works!

Exactly what I am doing. I figured that fighting the case would be more expensive than simply giving up. I developed other strategies to prevent chargebacks. I.e. I notify customers before I renew their account. This way at least those who do chargebacks due to being to stupid to cancel will not cause chargeback fees.

BTW, I have been using Paypal for 4 years and have collected around 200K through Paypal so I am quite experienced.

I just ran into my FIRST issue today with Paypal. We charged a client a few days ago for a hosting signup and yesterday a reversal was put in as "Unauthorized". I called Paypal to try to see what info they needed to verify the order but they said the case was already closed and the money was already taken and given back to the account holder. This baffles me considering Paypal won't even let me respond to a dispute. Isn't there a rebuttal period or something that is offered?

What I've noticed in the past is you have two types of PayPal disputes. You have unauthorized access/payment which are almost immediately reversed and case closed. I believe this has to do with the fact that your client signed up using someone else's account.

The 2nd type of dispute is your typical "I didn't receive service" type thing meanwhile the client has been rocking your service for months. These are the ones we used to try and fight.

Exactly what I am doing. I figured that fighting the case would be more expensive than simply giving up. I developed other strategies to prevent chargebacks. I.e. I notify customers before I renew their account. This way at least those who do chargebacks due to being to stupid to cancel will not cause chargeback fees.

BTW, I have been using Paypal for 4 years and have collected around 200K through Paypal so I am quite experienced.

It's wierd. Our one company uses automatic subscriptions and our one company does not. You'd think we'd get more chargebacks with the subscription based company but it's actually the opposite.

I would love to try the "mailing an item" method but that would be extremely costly for our business unfortunately.

Just make sure to let your accountant know of such reverses, etc. I know mine likes to know about all those so he can do something special with the money lost.

We have pretty good luck with Paypal and chargebacks. Simply because we don't rely soley on Paypal for the security of a transaction. We do our own research on each order this way in the event of a chargeback we at least have somewhat of a case available for us to make.

what research do you make?

We have pretty good luck with Paypal and chargebacks. Simply because we don't rely soley on Paypal for the security of a transaction. We do our own research on each order this way in the event of a chargeback we at least have somewhat of a case available for us to make.

I still feel that the time spent by an employee checking each signup, etc would cost MUCH more then just dealing with the fact that some people in this world are shyster's.

How much time does it take you to screen 1 order? Multiply that by ~100 and that's gotta be lots of time spent on $5.00-10.00 orders (in our case).

I still feel that the time spent by an employee checking each signup, etc would cost MUCH more then just dealing with the fact that some people in this world are shyster's.

How much time does it take you to screen 1 order? Multiply that by ~100 and that's gotta be lots of time spent on $5.00-10.00 orders (in our case).

A simple thing to do is add:

http://www.dnsstuff.com/tools/ipall.ch?domain=

before whatever code displays the ip address, that way when you receieve the order its a simple one-click to check if the address given matches the order location.

Not a 100% guaranteed method but its a good place to start, anyone who says they havent got the time to do that are making themselves targets for scammers and need to re-think there order and approval process.

Using a service like maxmind can be helpful as well.