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02-26-2012, 07:21 PM #1Junior Guru Wannabe
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Protecting yourself from PayPal chargebacks
Hi everyone,
I used to operate a VPS hosting business and am looking to get back into the playing field. In the past I had had a few small occurrences of charge-backs from my orders; there never seemed to be a pattern from PayPal's fraud department - I won some, and I lost some - regardless of my billing records from WHMCS and emails sent between my billing system and customer to show that my service was indeed active.
PayPal had once sent me some information about how to prevent charge-backs, but it all related to the shipping of a physical product.
Being in the hosting industry - how have you taken measures to prevent charge-backs?
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02-26-2012, 07:40 PM #2Web Hosting Master
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Mention in your response that it is a non-tangible product. Explain also why the chargeback is unfounded/or in the case of suspending service, why you suspended it.
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02-26-2012, 07:47 PM #3Junior Guru Wannabe
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02-26-2012, 07:48 PM #4Web Hosting Master
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02-27-2012, 12:58 AM #5Web Hosting Master
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Charge backs are done by the credit card company, not by PayPal too.
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02-27-2012, 01:00 AM #6Junior Guru Wannabe
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02-27-2012, 01:01 AM #7Newbie
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You should also keep and provide records of the account being used, like access logs. State in your terms your refund terms, how you handle chargebacks, etc.
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02-27-2012, 01:38 AM #8Web Hosting Master
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To be fair, PayPal already protects sellers pretty well in this regard already.
Make it clear with a Terms of Service agreement that's presented to the client during their order process that can easily be referenced stating no refunds or whatever your agreement is.
PayPal only charge $10 for each charge back, other providers are more than this, especially directly through bank merchants.
If the buyer states that charge that was made was not authorized on their behalf, you can't really dispute this though and 99% of cases these are fraudulent orders.
There is probably more merchants out there besides PayPal for credit card processing that have better policies or flexibility if you look else where besides PayPal.
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