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PayPal questions + scammy chargebacks

Discussion in 'Black Hat SEO' started by aidenhera, Jun 2, 2017.

  1. aidenhera

    aidenhera Elite Member

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    Hello

    Ive read a lot about scammy chargebacks. and its scary


    I wanna sell stuff through Paypal normal account, I have card linked to bank, does that mean if i withdraw the money someone sent me, he will chargeback directly from my bank?

    As far as I know in such case Paypal asks you about the proof but how should it look like?

    I will usually charge for about 10 dollars. Do I just give them my email on personal account or I need "merchant/seller account" and something else?

    Thanks!

    I have read paypal guidance but what they write there is complicated :(
     
  2. djbankrupt

    djbankrupt Junior Member

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    Usually, they just take $ out of your Paypal on a charge back. If you don't have the funds there, then it goes to withdraw from your bank account.
    Should use a merchant account for anything serious , and above board.
     
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  3. jimbobo2779

    jimbobo2779 Jr. VIP Jr. VIP

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    I don't know why people are so scared about using Paypal as payment processor, I have had way worse experiences with ClickBank, Bluesnap (previously Plimus) and 2Checkout. The refund and chargeback rate on CB was out of this world, way higher than any other provider by a large margin. 2Checkout blocked account when chargebacks went above 3%, their system supposedly does lots of checks to prevent too many chargebacks but it is weak at best.

    Bluesnap is not terrible but their fees are high and for processing Paypal payments you still need to have them go through your own PP account which defeats the object of going through such a payment processor as they still want their cut on top of PP fees.

    Going PP direct I have far lower chargeback rates and low refund rates. The dispute process can be a bit of a pain but if a customer claims unauthorised access I let PP deal with it and it is 50/50 who they will side with where other processors always favour the customer. PP dispute process seems relatively balanced compared to any other processor I have used.
     
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  4. Gogol

    Gogol Jr. VIP Jr. VIP

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    Paypal experience can hugely differ depending on what kind of product you are trying to sell. First off, don't try cheating them. Open an account with correct details and verify everything properly. This will ensure that if anything goes wrong, you are able to deal with it correctly.

    Now, coming to the products, if you have proper physical products that you will ship to your customer, and have permission to sell the product (trade license etc and dealership) and if you provide the tracking number to your customer.. paypal will never do anything bad to you (even if the product is not delivered.. because it's the courier who is responsible). That being said, the customer can then go to the bank and chargeback. Bank chargebacks are much more complicated and usually if the user is knowledgeable enough, he/she will get his/her money refunded ;). So, be sure to keep the customer happy.

    Digital products are much much more riskier to sell. User IP is NOT the proof of an authorized transaction. So, most of the time, paypal will refund the money to the user even if you did nothing wrong. This is how internet is, and you will have to deal with it.

    I agree that paypal is one of the worst companies when it comes to customer support, but not quite when it comes to the disputes. They have very little to do in these cases and have to follow the compliance rules most of the time.
     
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    Last edited: Jun 2, 2017
  5. aidenhera

    aidenhera Elite Member

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    what would you recommend for digital products then?
     
  6. Gogol

    Gogol Jr. VIP Jr. VIP

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    Nothing basically. You need to be prepared for chargebacks. By the way, one way around this would be to accept POS based card payment where the users will pay swipping their card, physically (if thats an option). That's much much harder to chargeback.

    I am sure another bhw member will come up with a much better solution for the digital products. I am not too good with it.

    Btw, as for prevention, If you are selling stuffs like software, keep your licensing server ready to ban that copy of the software if the user charged back..
     
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  7. WeWontBeAlone

    WeWontBeAlone Regular Member

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    PayPal isn't that scary, just take screenshots of everything, or make them send it as a gift. If it's a gift, there is no option to chargeback. If they file a dispute, if you've got proof you will win, if not, you can call them on the phone and explain, as long as you look more legitimate you can always take the case.
     
  8. se900se

    se900se Jr. VIP Jr. VIP

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    He will chargeback from your PayPal and PayPal cannot take money from the bank, so the negative balance will remain on paypal until you cover it and if you don't within the reasonable amount of time they will sell this debt to a debt collector who will try to get them from you.

    Chargebacks are the part of the business, some people are too lazy to ready what they getting and they don't really care about you, but as long as you don't scam people it wouldn't be an issue.
     
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  9. starki

    starki Power Member

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    Depends on product and customers I'd say. CB is pretty crazy with refunds, they agressively advertise their unconditional money back guarantee, but that's not a bad idea with mainly high risk transactions (digital products). Never experienced high chargeback rates with them, always below 0,5%. Works very well for us.

    Well, most payment processors will already kill your account at 1%, so waiting till 3% is pretty generous, but I agree, there is something wrong with them. Their upfront scrubbing and fraud checks utterly suck!

    And their customer service is the worst I've experienced in a long time.

    Yeah, they are in much more comfortable position. First, they are really huge, so no credit card company would dare to cancel their contracts with them. Second, their main business is tangible goods, low risk transactions. Most other processors don't favour the customer because they want to, but because they have to to protect their business. Especially Amex is very picky and known to boot processors fast. Another advantage: End users don't care if 2CO, Bluesnap or Clickbank blocks them, so they try chargebacks even for $10. Paypal is different, they use it to pay on Ebay and various other sites, so they think twice before risking their account for bogus disputes or even chargebacks.