In today’s article I’m writing about a chargeback I had on Paypal. This one wasn’t a scam, but there’s a good takeaway from the situation for anyone selling products or services online.
Read my previous posts about scams I’ve experienced:
Part 1 – https://onmoneyline.com/selling-online-paypal-and-scams-part-1/
Part 2 – https://onmoneyline.com/selling-online-paypal-and-scams-part-2/
Part 4 – https://onmoneyline.com/selling-online-paypal-and-scams-part-4/
Part 5 – https://onmoneyline.com/selling-online-paypal-and-scams-part-5/
Part 6 – https://onmoneyline.com/selling-online-paypal-and-scams-part-6/
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Scam? What happened?
I’ll be totally honest here, I don’t remember what exactly happened. It’s been 4 years since this took place, so I don’t remember what happened in detail. But it doesn’t matter, I have a vague memory of what happened, and that’s enough to make my point.
Back in 2016 someone purchased a service with Paypal for $19.99 on one of my websites, and some time later they raised a chargeback/dispute asking for their money back, saying that they didn’t receive the item.
New Item Not Received Dispute:
Hello [NAME],
[NAME] has opened a dispute over the payment made to you on Apr 7,
2016 indicating that they never received the item.
———————————–
Transaction Details
———————————–
Buyer’s name: [NAME]
Buyer’s email: [EMAIL]
Transaction ID: ######Transaction date: Apr 7, 2016
Transaction amount: $19.99 USD
Your transaction ID: ######
Case number: ######Disputed Amount: -$19.99 USD
– The disputed amount has been temporarily deducted from your account until
the dispute is resolved.By opening this dispute, [NAME] is asking for your help to resolve
this issue. This is your best opportunity to resolve this problem before
the buyer escalates it to a PayPal claim or files a chargeback with their
card issuer.——————————
—–
What To Do Next
———————————– Most of the time, disputes can be resolved quickly and amicably by
communicating with the buyer in the Resolution Center. There, you’ll be
able to review the dispute details, post messages back and forth with the
buyer, or ask PayPal to decide the case by escalating this dispute to a
claim.To learn more about PayPal’s dispute resolution process, log in to your
account and click the Tutorials link on the Resolution Center tab.——————————
—–
Time frame
———————————– [NAME] can escalate this dispute to a PayPal claim at any time
until 4/30/2016. On that date, this dispute will automatically close.We encourage you to respond to the buyer as soon as possible. A buyer who
feels that you are working with them to resolve a problem is less likely to
escalate a dispute to a claim.Thank you,
PayPalPlease do not reply to this email. This mailbox is not monitored and you
will not receive a response. For assistance, log in to your PayPal account
and click the Help link in the top right corner of any PayPal page.Copyright © 1999-2016 PayPal. All rights reserved.
PayPal (Europe) S.à r.l. & Cie, S.C.A.
Société en Commandite par Actions
Registered Office: 22-24 Boulevard Royal, L-2449, Luxembourg
RCS Luxembourg B 118 349PPID PP903 – 7d33803264f23
At this point I replied to the customer on Paypal, and waited for their response. The customer didn’t reply, and so 2 days later I escalated the chargeback/dispute to a claim (so that Paypal will review the case) and presented my case.
Your Dispute Has Been Escalated To A Claim:
Hello [NAME],
We have received your request to escalate this dispute to a claim. We will review all messages about this dispute in the Resolution Center and contact you for more information – please respond within 10 calendar days.
If you do not respond on time, the case may be decided in favor of the buyer.
Transaction Details
Buyer’s Name: [NAME]
Buyer’s Email: [EMAIL]
Buyer’s Transaction ID: ###
Transaction Date: 7 April 2016
Transaction Amount: 19,99 USD
Your Transaction ID: ###
Case Number: ###What to Do Next
To help resolve this case quickly and fairly, please follow these steps within 10 calendar days:
Go to www.paypal.com and log in to your account.
Go to the Resolution Center.
Next to this case, click Respond and follow the instructions.Due Dates
Provide more information within 10 calendar days from the date this case was filed.
It’s essential that you participate in the claims process. If you don’t respond to our requests within the given time frame, we will automatically refund the buyer.
As the claim may be resolved in the buyer’s favor, please make sure your PayPal account has enough balance to cover a refund.
Thanks,
PayPal
PayPal: Complaint PP-### Tracking Information Received:
Hello [NAME],
We have received the tracking information you submitted in reference to the
following complaint:Buyer’s name: [NAME]
Buyer’s email: [EMAIL]
Transaction ID: ######Transaction date: Apr 7, 2016
Transaction amount: $19.99 USD
Your transaction ID: ######
Case number: ######Tracking Company: Other
Tracking Number: Virtual GoodsWe have contacted the buyer with the information you provided and are
waiting for the buyer’s response.Unless the buyer cancels this complaint, this investigation will continue.
We will notify you as soon as the investigation has been concluded.For your future reference, you can provide Shipping Tracking information to
the Buyer prior to a complaint being filed. This allows you to facilitate
communication to the Buyer that the package was shipped. To learn more
about this feature, please click the following link:https://www.paypal.com/cy/cgi-
bin/?cmd=_help Sincerely,
PayPal Protection Services Department
Resolution
What actually happened was that a customer purchased a service that had a 7 day delivery time. It was a type of service that could start instantly and then get delivered slowly over a period of 7 days. But it could also start 5 days later and get delivered within 24 hours. I don’t know if the customer had experiences purchasing such a service elsewhere and so they were expecting a quick start on their order, but on day 3 they raised the chargeback/dispute for their payment.
Eventually I managed to talk to the customer and explain to them that their order has been received and was being worked on and will be delivered. But as we have a 7 day delivery time, they should allow us the 7 days to deliver their order. The customer agreed, and they cancelled the chargeback/dispute.
Completion of Buyer Complaint Investigation
Dear [NAME],
PayPal has concluded our investigation of the following Buyer Complaint:
Buyer’s name: [NAME]
Buyer’s email: [EMAIL]
Transaction ID: ###Transaction date: Apr 7, 2016
Transaction amount: $19.99 USD
Your transaction ID: ###
Case number: ###Because the buyer has reported that the claim has been amicably resolved,
this case has been closed.Thank you for your cooperation with our investigation.
Sincerely,
Protection Services Department
What’s the takeaway?
The takeaway from this article is that a chargeback is not necessarily always a scam. In this instance the customer overreacted, possibly thinking that they were being scammed as the service didn’t start quickly. What they should have done is contacted us through our website’s contact form and asked about their order. Instead they chose to do a Paypal chargeback/dispute. But after getting in touch with them and explaining the situation, they cancelled the chargeback and the order was eventually delivered.
So if you do get a chargeback on Paypal, try to get in touch with the customer and see why they did it. If they’re not a scammer, and with a little luck, you may be able to work it out with them to where you explain the situation, or maybe you provide them some other service or give them something extra in order to have them close the chargeback.
Could it still be a scam?
That said, I can’t say if this wasn’t actually an attempt at a scam. Perhaps the client thought they would buy the service, raise a chargeback and get their money back, and then due to the mixup we would also deliver the service. And so they would get the service delivered and get their money back. But when they saw that I will fight the case on Paypal, then they closed the chargeback and received the service, and we kept the money.
I can’t say exactly what was behind this, but all in all it was brought to a conclusion in a satisfactory manner.
Here is a video I made talking about this:
Conclusion
The conclusion is that chargebacks are not always a scam, and reaching out to the customer and talking with them will often be the best way to bring the chargeback to an end successfully to where both parties are happy. Also, don’t always be defensive and pessimistic, immediately thinking that you’re dealing with a scammer and you better just refund the money and close the case. Sometimes you should fight it, and sometimes you’ll win, and sometimes you’ll lose.