Results 1 to 25 of 25
  1. #1
    Join Date
    Oct 2012
    Posts
    47

    Charge back on 4 month old sale via PayPal

    I lost data of my clients and thought to move them to new server but today I got 3 charge back.

    2 were of small amount. I understand they can fight for their loss. But I am not getting how a 4 month old sale of $40 got a charge back?

    Case:

    1. I was paid $40 by client for making a front end(html and css) and back end (box billing cnfig.) and reseller hosting for 1 year.
    2. When I asked for pricing he said he doesn't need it now.
    3. Later I changed my server IP. He was using a mail which was on old IP so I can't reach him and ask him to change IP.
    4. After a month I contacted him about the new IP and he asked his credit card company to make a charge back.


    Now he never tried to contact me, didn't specified any reason for charge back and is now not replying to emails. Domain is having whois. I called PayPal and they told me they are helpless.

    Now I have many questions:

    1. My frend can make 3 charge back a year and that too within 3 months. So how could he do that? VISA and Master Cards have different policies in different countries?
    2. How can we trust PayPal as for Website Designers their is no protection.
    3. PayPal is still considered best (read somewhere that others refund money even after 1 year).
    Last edited by abhishekkjain; 10-04-2013 at 01:49 PM.

  2. #2
    Join Date
    Jan 2011
    Location
    Between Earth & sky
    Posts
    473
    Its look like visa and master card have different policies for different countries based on fraud rate

    It will be great if you provide proof of your work to PayPal, any thing which shows both of you agree on $40, emails between you and your client, any proof help in your case
    VMakerHOST Providing Amazing Services since 2010
    Three Datacenter Locations: Chicago, Netherlands & Singapore
    █ Reseller Hosting with WHMCS | End User Support | Premium Network | 24x7-365 Support
    ShoutCAST, Web Hosting, Virtual Servers & Dedicated Servers. Managed options available

  3. #3
    Join Date
    Jun 2011
    Location
    Indonesia
    Posts
    1,775
    have you said to paypal that you sell hosting which are intangible and cannot be recouped against a chargeback or refund?

  4. #4
    Join Date
    May 2011
    Location
    Chicago, IL
    Posts
    652
    Unfortunately paypal provides zero protection against intangible sales, all of us on this form are always subject to not only charge backs from credit cards, but also paypal complaints. Its a miserable system, but unfortunately its just a cost of doing business. The only thing that you can do is eat some ice cream to feel better.

    If you have enough volume you can go directly through a bank which cuts out the middle man (i.e. paypal) and thus eliminates charge back fees. You will still need to make decisions to refund payments from time to time to prevent small claims actions but you won't be required to pay this charge back "administrative" fee paypal charges willy nilly EVEN if you refund a known fraudulent charge that they let through! Gah!
    www.BigScoots.com - Experience the Difference, Ride With Us
    Specializing in Premium Shared, Reseller, VPS, Hybrid and Dedicated Hosting
    Fully Managed | 100% Positive Approval Rating! | Server Migrations
    REAL 24/7/365 US Based ~5 Minute Response Times | 100% Network Uptime

  5. #5
    Join Date
    Sep 2002
    Location
    Top Secret
    Posts
    11,686
    Quote Originally Posted by VMakerHOST View Post
    Its look like visa and master card have different policies for different countries based on fraud rate
    The standard for U.S. is 6 months

    Quote Originally Posted by Tuguhost View Post
    have you said to paypal that you sell hosting which are intangible and cannot be recouped against a chargeback or refund?
    This doesn't apply here. The customer's bank is doing the chargeback, not paypal. If it was directly paypal, then this would absolutely apply here.

    Quote Originally Posted by BigScoots-Scott View Post
    Unfortunately paypal provides zero protection against intangible sales
    Nonsense!
    Paypal has the best protection in the world for sellers of virtual goods! ALL you have to do is tell them "this is a service", and that's an immediate decision in your favor, for a Paypal dispute.

    The problem here is that this isn't a Paypal dispute. This is a bank dispute. This is a case where customer went to the bank and said
    I don't recognize this charge
    or
    I never received what was promised
    @ the OP:
    Have you sent over every bit of documentation to paypal you have? Emails, chats, everything... If not, I would strongly advise doing so now. This might (or might not) help, but it can never, ever hurt.

    Bank chargebacks are evil when it comes to the vendor. In a majority of the cases (I'd say 90%+), they're going to side with their customer, unless you can provide solid proof that you not only delivered the service, but went out of your way to verify that yes, this was the customer ordering the service.
    WHMCS Guru - WHMCS addons, management, support and more.
    WHMCS Notifications Extended - Add slack, hipchat, SMS, pushover to WHMCS !!
    Always looking for Linux, WHMCS, Support Desk work. PM for details

  6. #6
    Join Date
    May 2011
    Location
    Chicago, IL
    Posts
    652
    Paypal provides zero seller protection for intangible goods, a quick google will tell you that.

    https://www.paypal.com/us/webapps/mp...protection-faq
    www.BigScoots.com - Experience the Difference, Ride With Us
    Specializing in Premium Shared, Reseller, VPS, Hybrid and Dedicated Hosting
    Fully Managed | 100% Positive Approval Rating! | Server Migrations
    REAL 24/7/365 US Based ~5 Minute Response Times | 100% Network Uptime

  7. #7
    Join Date
    Sep 2002
    Location
    Top Secret
    Posts
    11,686
    Quote Originally Posted by BigScoots-Scott View Post
    Paypal provides zero seller protection for intangible goods, a quick google will tell you that.
    Way to misinterpret things.
    Paypal's buyer protection policy does not cover virtual goods, it's a well known fact, been that way for years.

    Of course they don't have any seller protection for virtual good. All the seller has to do is tell them that it's a virtual transaction, services were provided, and the buyer automatically loses the claim, as long as it was paid via PayPal funds.
    WHMCS Guru - WHMCS addons, management, support and more.
    WHMCS Notifications Extended - Add slack, hipchat, SMS, pushover to WHMCS !!
    Always looking for Linux, WHMCS, Support Desk work. PM for details

  8. #8
    Join Date
    May 2011
    Location
    Chicago, IL
    Posts
    652
    Quote Originally Posted by twhiting9275 View Post
    Way to misinterpret things.
    Paypal's buyer protection policy does not cover virtual goods, it's a well known fact, been that way for years.

    Of course they don't have any seller protection for virtual good. All the seller has to do is tell them that it's a virtual transaction, services were provided, and the buyer automatically loses the claim, as long as it was paid via PayPal funds.
    Paypal's "seller" protection policy does not cover virtual goods. I'd say at least 90% of our transactions are via credit card, perhaps its just the luck of the draw that all the charge back claims have been directly through a credit card, but I know for a fact simply telling them that the services were provided wont cause them to rule in your favor -- which does make a bit of sense given the only real way they can arbitrate an issue is by having a quantitative result in front of them, such as a tracking number. How would they ever verify the "service" has been done? -- thus not covering it in their "seller protection." I've been up through the ranks of many senior managers over the years as I complained about this fact trying to avoid paying these nonsensical charges, but never did it go in our favor. I'm not sure there was ever a question about dealing with "paypal funds" as the OP asks specifically about creditcards, and with credit cards, you will always, always loose when dealing with intangible goods.
    Last edited by BigScoots-Scott; 10-06-2013 at 01:10 AM.
    www.BigScoots.com - Experience the Difference, Ride With Us
    Specializing in Premium Shared, Reseller, VPS, Hybrid and Dedicated Hosting
    Fully Managed | 100% Positive Approval Rating! | Server Migrations
    REAL 24/7/365 US Based ~5 Minute Response Times | 100% Network Uptime

  9. #9
    Join Date
    Feb 2006
    Location
    Kepler 62f
    Posts
    14,877
    I never understand this. Most banks have 90-day policies. I know Chase and Bank of America do in USA. So how does this happen?
    || Need a good host?
    || See my Suggested Hosts List || Editorial: EIG/Site5/Arvixe/Hostgator Alternatives
    ||

  10. #10
    Join Date
    Feb 2007
    Location
    USA, UK, Singapore
    Posts
    3,325
    PayPal does in fact defend the sellers to great extent as long as you can provide them with documentation for product delivery / terms of service.

    Most banks does have 90 day policy for customers so that they can evaluate the case and file it before a -bank- dead line of 120 days that exists for most types of chargebacks. There are few chargebacks that can be issued even after this 120 days (possibly up to 180 days though I'm not entirely sure on figure) by bank for certain type of transactions where services are going to be provided in future as per the contract between buyer / seller.
    ██ Softsys Hosting ██ - 9 Years In Business - 24/7 In-House Support - Enterprise DDoS Protection Available!

    Enterprise Dedicated Servers - WHT Exclusive Windows & Linux VPS (US/UK/Singapore) - Failover Ready Cloud VM's

  11. #11
    Join Date
    Sep 2002
    Location
    Top Secret
    Posts
    11,686
    Quote Originally Posted by BigScoots-Scott View Post
    Paypal's "seller" protection policy does not cover virtual goods
    Unless you know from personal experience, please, just stop now. I do know from personal experience, on both sides of this:

    Products sold as virtual goods are not covered under the buyer agreement. So, all one has to do is tell them (either as a buyer, or a seller) that the 'product' purchased is a virtual good, and they'll do nothing about it.

    I've had a couple of individuals try to launch paypal based chargebacks on code work done for them. All that had to be done was tell Paypal it was a virtual service, case closed.

    In the same respect, I've had to deal with more than my share of paypal service providers that just flat out didn't deliver anything. Paypal's response, as soon as I told them it was a service?

    The buyer protection program does not cover services, or virtual products
    I don't go around touting stupid stuff without information here. I'd suggest you stop now while you're ahead, because this is definitely an area you're not familiar with.
    WHMCS Guru - WHMCS addons, management, support and more.
    WHMCS Notifications Extended - Add slack, hipchat, SMS, pushover to WHMCS !!
    Always looking for Linux, WHMCS, Support Desk work. PM for details

  12. #12
    Join Date
    May 2011
    Location
    Chicago, IL
    Posts
    652
    Of course I have personal experience, we used paypal for several years as our primary merchant. We're obviously talking about 2 different things here, I'm speaking specifically in regards to credit cards, not "paypal based transactions." If someone comes through a paypal merchant account using only a credit card to check out and decides to file a charge back through their credit card company 3 months later, there is nothing that can be done on intangible goods. If you think otherwise I'd love to arrange a conference call with paypal so I can get a straight answer from an authority as I would certainly like to know and also pursue action against all the chargebacks issued by creditcard companies. 100% of all our charge backs are always fraud so regardless I don't see us coming out ahead as we would of course refund the transaction regardless, but not having to pay the chargeback fee would be just dandy.

    As a side note, you really don't need to be this defensive, clearly people in this thread have had different experiences and to call anyone stupid just because they haven't had your personal experience is uncalled for. For me personally, many chargebacks on hosting related services and many angry calls to paypal with proof of service being rendered has 100% of the time resulted in us loosing the claim, so to suggest we are incorrect seems to suggest that more than 20 employees of paypal's upper management in succession just seem to not know how to handle chargeback claims when issued from a credit card company.

    Again, perhaps we're talking about different things if you can provide proof of a design being sent, or code being completed, but with purely something as intangible as hosting, we've been 100% unsuccessful with very diligent attempts defending ourselves.
    www.BigScoots.com - Experience the Difference, Ride With Us
    Specializing in Premium Shared, Reseller, VPS, Hybrid and Dedicated Hosting
    Fully Managed | 100% Positive Approval Rating! | Server Migrations
    REAL 24/7/365 US Based ~5 Minute Response Times | 100% Network Uptime

  13. #13
    Join Date
    Apr 2009
    Location
    New York City
    Posts
    5,054
    Gather up as much proof you have showing that you delivered your service to your client and that he has told you he is satisfied.

  14. #14
    Join Date
    Sep 2002
    Location
    Top Secret
    Posts
    11,686
    [QUOTE=BigScoots-Scott;8866103] I'm speaking specifically in regards to credit cards, not "paypal based transactions." [QUOTE]
    Paypal covers nobody when it comes to credit cards or bank transactions. They can't.

    When doing transactions via card, or ach, Paypal is no different from your credit card processor. They don't care whether it's virtual, or physical product, it's just not possible.

    The reason for this? The buyer's bank (cc issuer) will always side with the buyer in a virtual (service) transaction. No questions, no comments, case closed. There is no proof at all that a virtual transaction is made by the buyer, and, even if you sent over hundreds of emails/im conversations, it's always going to be the buyer that wins.

    In a physical product, you can prove items have been shipped, even require signature so that the buyer proves they got it. Of course, that's still fallible, but at least you've got protection there.

    When it comes to outside payment sources though, Paypal doesn't cover any seller, it just can't.
    WHMCS Guru - WHMCS addons, management, support and more.
    WHMCS Notifications Extended - Add slack, hipchat, SMS, pushover to WHMCS !!
    Always looking for Linux, WHMCS, Support Desk work. PM for details

  15. #15
    Join Date
    Mar 2006
    Location
    Servers
    Posts
    1,588
    Quote Originally Posted by twhiting9275 View Post
    The standard for U.S. is 6 months


    This doesn't apply here. The customer's bank is doing the chargeback, not paypal. If it was directly paypal, then this would absolutely apply here.


    Nonsense!
    Paypal has the best protection in the world for sellers of virtual goods! ALL you have to do is tell them "this is a service", and that's an immediate decision in your favor, for a Paypal dispute.

    The problem here is that this isn't a Paypal dispute. This is a bank dispute. This is a case where customer went to the bank and said

    or


    @ the OP:
    Have you sent over every bit of documentation to paypal you have? Emails, chats, everything... If not, I would strongly advise doing so now. This might (or might not) help, but it can never, ever hurt.

    Bank chargebacks are evil when it comes to the vendor. In a majority of the cases (I'd say 90%+), they're going to side with their customer, unless you can provide solid proof that you not only delivered the service, but went out of your way to verify that yes, this was the customer ordering the service.
    Nothing to do with the reality. PayPal is almost every time takes the buyer side. We have lost almost all the disputes does not matter is it a service.
    QHoster.com - Web Hosting with DDoS Protection | Shared & Reseller in Europe/North America
    Linux/Windows RDP VPS 13 Locations : UK, US (5 states), Mexico, Canada, Bulgaria, Lithuania,
    Italy, France, Germany,Netherlands, Switzerland, Rissia, Singapore | OpenVPN/PPTP Enabled
    INSTANT | PayPal, Skrill, Payza, Bitcoin, WebMoney, Perfect Money, Ukash, CashU, paysafecard

  16. #16
    Join Date
    May 2011
    Location
    Chicago, IL
    Posts
    652
    [QUOTE=twhiting9275;8866170][QUOTE=BigScoots-Scott;8866103] I'm speaking specifically in regards to credit cards, not "paypal based transactions."
    Paypal covers nobody when it comes to credit cards or bank transactions. They can't.

    When doing transactions via card, or ach, Paypal is no different from your credit card processor. They don't care whether it's virtual, or physical product, it's just not possible.

    The reason for this? The buyer's bank (cc issuer) will always side with the buyer in a virtual (service) transaction. No questions, no comments, case closed. There is no proof at all that a virtual transaction is made by the buyer, and, even if you sent over hundreds of emails/im conversations, it's always going to be the buyer that wins.

    In a physical product, you can prove items have been shipped, even require signature so that the buyer proves they got it. Of course, that's still fallible, but at least you've got protection there.

    When it comes to outside payment sources though, Paypal doesn't cover any seller, it just can't.
    OK, so we were talking about 2 different things then. I was talking about what the OP was referencing which was specifically MC and VISA transactions. Unfortunately not that many people are paying directly with paypal these days, as much as we'd like their added layer of security, credit cards are just simply a necessary evil. Charge backs are just a cost of doing business it would seem.

    Good luck OP!
    www.BigScoots.com - Experience the Difference, Ride With Us
    Specializing in Premium Shared, Reseller, VPS, Hybrid and Dedicated Hosting
    Fully Managed | 100% Positive Approval Rating! | Server Migrations
    REAL 24/7/365 US Based ~5 Minute Response Times | 100% Network Uptime

  17. #17
    Quote Originally Posted by BigScoots-Scott View Post
    Unfortunately not that many people are paying directly with paypal these days
    As a hosting provider in the "budget host market" we get a fair amount of orders per day and 90% of the time our clients choose PayPal.

  18. #18
    Join Date
    May 2011
    Location
    Chicago, IL
    Posts
    652
    Quote Originally Posted by WebHostDog View Post
    Nothing to do with the reality. PayPal is almost every time takes the buyer side. We have lost almost all the disputes does not matter is it a service.
    Great, that is nice you've got that added layer of security especially in the budget market where fraud is a little more common. At least that is my observation.
    www.BigScoots.com - Experience the Difference, Ride With Us
    Specializing in Premium Shared, Reseller, VPS, Hybrid and Dedicated Hosting
    Fully Managed | 100% Positive Approval Rating! | Server Migrations
    REAL 24/7/365 US Based ~5 Minute Response Times | 100% Network Uptime

  19. #19
    Join Date
    Sep 2002
    Location
    Top Secret
    Posts
    11,686
    Quote Originally Posted by WebHostDog View Post
    We have lost almost all the disputes does not matter is it a service
    If you're losing all of your disputes, you're definitely doing something very, very wrong.

    From a provider standpoint, I've been doing business with Paypal for better than 11 years. Of course, the occasional dispute comes in (I think I've had maybe 5 in 11 years, if that). Every single one of them was won by me.

    Paypal doesn't take the buyer's side in every case. Yes, if you get an extraordinary number of cases, they'll probably take the side of the buyer a bit more frequently, but to claim "PayPal is almost every time takes the buyer side." is just incorrect.

    Each and every case is going to be weighed independently, of course. However, if you're having repeated problems with paypal siding with your customers, it's time to investigate why they're actually doing that, and change your business practice, because, yes, you're doing something wrong.
    WHMCS Guru - WHMCS addons, management, support and more.
    WHMCS Notifications Extended - Add slack, hipchat, SMS, pushover to WHMCS !!
    Always looking for Linux, WHMCS, Support Desk work. PM for details

  20. #20
    Join Date
    Mar 2013
    Location
    Orlando, FL
    Posts
    317
    I disagree completely. We have had customers putting in disputes over simple things like not wanting to provide IP justification and have picked up the phone on more then one occasion and have said "We are selling a service and not a tangible item" and within minutes the compliant is closed. I never seen anything but this.

    We have also had one customer go to the bank and dispute the charge after loosing the dispute and PayPal informed them that they sided with us.
    Last edited by CloudComputingLV; 10-07-2013 at 03:27 AM.

  21. #21
    Join Date
    Sep 2002
    Location
    Top Secret
    Posts
    11,686
    Quote Originally Posted by CloudComputingLV View Post
    We have also had one customer go to the bank and dispute the charge after loosing the dispute and PayPal informed them that they sided with us.
    huh, that is unusual . Typically, the bank will side with the customer, and Paypal won't go against the bank, they can't.
    WHMCS Guru - WHMCS addons, management, support and more.
    WHMCS Notifications Extended - Add slack, hipchat, SMS, pushover to WHMCS !!
    Always looking for Linux, WHMCS, Support Desk work. PM for details

  22. #22
    Join Date
    May 2008
    Location
    Melbourne, Australia
    Posts
    10,482
    I had something like this happen with 2Checkout - we had an order in November 2012, we got a charge-back in March 2013 - ironic, and the payment was refunded as well. *Or the multiples*.
    l Dedigeeks (Twitter) Shared Reseller Cloud VPS Since 2010
    l Leading AU Hosting Provider Multiple locations - around the globe!
    l cPanel/WHM R1Soft Backups 24/7/365 Support 99.9% Uptime Guarantee
    l www.yourcompanynamehere.com Customer Service Rep. Superior Service Guarantee

  23. #23
    Join Date
    Dec 2012
    Location
    .ssh
    Posts
    976
    Things like this just happen in this industry, when I first started out I remember times that I had a chargeback which was 200+ I managed to win that one and most others and we rarely get many but sometimes you have to suck up the cost and sometimes you win.

    It's all part of the business

  24. #24
    Join Date
    Jan 2012
    Location
    Same Location
    Posts
    23
    Blame the crook customer, I wouldn't blame Paypal. Paypal can do nothing with chargeback, the card issuer make the decision.

  25. #25
    Join Date
    Oct 2013
    Posts
    27
    I have learned many thing from this discussion here and I have decided not to add an account with Paypal that is having balance everytime in it and never to connect credit card with general use paypal account.

Similar Threads

  1. charge back on instant payment in Paypal
    By constantine in forum Ecommerce Hosting & Discussion
    Replies: 18
    Last Post: 08-29-2006, 06:27 PM
  2. More Charge Back Protection (2CheckOut or PayPal)
    By seekhosting in forum Ecommerce Hosting & Discussion
    Replies: 7
    Last Post: 07-17-2004, 01:54 PM
  3. I got some Charge Back of PayPal in the past two months.
    By seekhosting in forum Ecommerce Hosting & Discussion
    Replies: 3
    Last Post: 07-17-2004, 01:41 AM
  4. paypal charge back
    By marinedog in forum Web Hosting
    Replies: 22
    Last Post: 11-13-2003, 07:00 PM
  5. Paypal and charge back
    By twiztv in forum Running a Web Hosting Business
    Replies: 10
    Last Post: 01-06-2003, 05:10 AM

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •