A group of online merchants has filed Federal class action against PayPal regarding its dispute resolution policies which tend to favour the buyer. If you use PayPal or accept credit cards in your online store, you would understand the risks involved and the fear of buyers taking advantage of these policies is very real.
Buyers who file a complaint with their credit card companies to invalidate a payment would usually have their chargeback approved by PayPal and they know it and some dishonest buyers use this to their advantage. Do you think that once a reversal of payment against a seller's account has been approved that the buyer would return the item that he has bought to the merchant? No "sane" person would do that, right?
With a dispute policy like this, it is not surprising that online merchants who have the luck to meet dishonest buyers would end up with a loss, losing their product. It would be interesting to see how this class action would conclude, though I guess such a court case would be long-drawn.
Buyers who file a complaint with their credit card companies to invalidate a payment would usually have their chargeback approved by PayPal and they know it and some dishonest buyers use this to their advantage. Do you think that once a reversal of payment against a seller's account has been approved that the buyer would return the item that he has bought to the merchant? No "sane" person would do that, right?
With a dispute policy like this, it is not surprising that online merchants who have the luck to meet dishonest buyers would end up with a loss, losing their product. It would be interesting to see how this class action would conclude, though I guess such a court case would be long-drawn.
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