How to Prevent a PayPal Chargeback

If you accept payments for goods through PayPal you are always running the risk that a customer may do a chargeback. If a customer is not satisfied with his purchase or does not receive the item he purchased he can file a claim at PayPal. There are some things you can do to prevent PayPal chargebacks and protect yourself as a seller.

Difficulty: Easy

Instructions

1. Keep lines of communication open with your customers. Let them know when their packages ship and encourage them to contact you directly if they have a problem with their purchase. Try to resolve all customer complaints yourself to prevent PayPal chargebacks.

2. Upgrade your account at PayPal to a Business or Premier account it you currently have a Personal account. Only Business and Premier accounts are covered with the PayPal Seller's Protection Policy.

3. Review the Seller's Protection Policy at the PayPal site and familiarize yourself with the requirements for coverage.

4. Sell only to customers within the US, the UK and Canada. These are the only countries that are protected under the Sellers Protection Policy.

5. Ship packages through an approved shipping service, there is a list of them on the PayPal website. Always ship with a traceable online proof of delivery method. If shipping US Postal this means that all packages need to be "Delivery Confirmed."

6. Mail packages only to PayPal confirmed shipping addresses listed on the "transaction detail" page of the payment. Packages must ship within seven days of receipt of payment to qualify for Sellers Protection.

7. Cooperate and communicate with PayPal if you are notified of a claim being filed. Communicating through the PayPal process can sometimes resolve the issue preventing the chargeback.

Tips & Warnings

• To prevent "significantly not as described" PayPal chargebacks be sure to describe all auctions accurately and tell buyer about all flaws and damages the item for sale might have.
• It is a good idea to insure all packages being shipped. Items broken in transit are a common reason for a customer filing a "significantly not as described" claim. If a customer files a claim for an item broken in shipment, PayPal will find on behalf of the customer and tell her to return it to you for a full refund. Insurance will allow you to recover at least some of your loss from the shipping company.
• Following these steps will help to protect you from a PayPal chargeback under the Seller's Protection Policy if your customer is filing a charge back because of non-receipt of goods. The Seller Protection Policy does not protect you from a chargeback if the customer claims the item he received was different from the item you described in your auction. In these cases the claim is reviewed by PayPal and a determination is made by them on an individual case basis.