Paypal Protection

Paypal are notorious for siding with a customer in a dispute.  There are also the occasional problems with any online selling where the customers can try to scam you by saying the items never arrived and file a paypal dispute to get a refund.

Paypal’s requirements for proof of shipping are:


https://www.paypal.com/us/webapps/mpp/ua/useragreement-full#13

So

  • Signature on delivery is the safest way to ship something (In Australia our “registered post” requires customers to sign for the package) – while it can be an extra inconvenience for the customer if they are not home when delivery is attempted, it does provide absolute proof that someone signed for the package (which is supposed to be the addressee) – assisting you in any claims that the package was stolen or never arrived.
  • In Australia, using “MyPost” (formerly “Click and Send”) seems to be the safest option for non-registered mail, as this links the tracking number for the package with the address of the customer.  This seems to be the proof paypal needs that the package was sent to that recipient (they won’t accept tracking numbers alone, as there is nothing linking that tracking number to that customer)
  • It is safest to lodge the packages over the counter at a post outlet where they will be scanned into the system straight away (rather than dropped into the roadside mailboxes, where they may not be scanned into the system until they reach a distribution centre, and therefore could potentially be lost along the way and unable to be traced).
  • Packages left on customer’s doorsteps are not safe – if a customer says it’s fine to leave the package on the doorstep, it is up to you whether you are prepared to accept that risk.  You can use “Do not Safe Drop” stickers to tell postal workers not to leave packages if the recipient is not home (although these don’t always work)
  • Paypal will require proof that you sent the item to the customer.  Packages without tracking are impossible to trace within the postal system, so offer you no protection as a seller.  The best you can do is to photograph the package and lodge it over the counter asking for the postal carrier to issue you with a receipt that shows the post code.  This won’t be proof enough for paypal, but it’s better than nothing and may help you if you try fighting any disputes with the postal carrier or ombudsman.
  • A tracking number alone is not sufficient for paypal, unless it also shows the address of the recipient.  Using services that link the tracking number to the address of the customer may be sufficient proof that shows that tracking number being assigned to that address (eg paypal shipping or Australia Post “MyPost”).  Secondary to that you could try taking a photo of the package that shows the address and tracking number together on the package.
  • Paypal requires the items to be shipped to the address listed in paypal.  This does cause a problem if a customer gives you an address different to their paypal address.  You can take a screen shot as proof of the customer’s address as given to help fight any claims about this, but it is safer to ask the customer to update their paypal address within paypal if they have moved and not updated their paypal address.
  • You can try keeping a copy of any shipping labels in case the info is needed later.
  • Paypal is not as all powerful as it claims to be – as it is a financial service, it is under the control of the financial industry ombudsman (may be called something different in the US).  So if you have an issue with paypal where they have found in favour of the customer when you have proof that you have sent the goods – the ombudsman may be able to assist you.

(I was once able to get a paypal ruling overturned by the ombudsman when a tracked {express} package was disputed, when I only had the tracking number and no other proof of lodgement – although I did get Australia Post to investigate and provide me with a letter that said the package had been delivered to that address)