A Reseller’s Guide to PayPal Seller Protection

Reselling Tips
A Reseller’s Guide to PayPal Seller Protection

If you’re selling online and your customers are purchasing using PayPal it’s important you know about PayPal Seller Protection. Your small business needs to be protected at every turn, including when it comes to processing payments from customers. It is here that choosing a payment provider with seller protection comes in handy.


Here we will cover what PayPal Seller Protection is, eligibility, what’s covered and what’s not so you can best protect your online business.


What is PayPal Seller Protection?


Selling online securely can be challenging, we know! With PayPal Seller Protection, you can protect yourself against chargebacks, reversals, and claims for the full amount if an unauthorized transaction occurs or an item is not delivered. Your online sales will be secure, claims and chargebacks will be minimized, and you can rest knowing you are safeguarded against merchant fraud. 


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As resellers we want peace of mind knowing our personal information, payment and interactions online are safe. The PayPal Seller Protection policy offers a range of transaction security measures which include:


  • 24/7 Monitoring

  • Online Transaction Encryption

  • Merchant Fraud Prevention

  • Dispute Resolution

  • Global Transaction Security

  • Added layer of protection for your financial information


PayPal Seller Protection covers two types of claims: 

  1. Unauthorized Transactions

  2. Items Not Received


An Unauthorized Transaction is when a buyer claims they didn’t authorize a payment. Items Not Received is when a buyer claims they never received the item they purchased. 


As a seller you may be concerned how these claims will affect your PayPal balance. This policy helps keep your balance intact for all eligible tangible and intangible (digital items or services) transactions. You’ll want to keep clear records of transactions being fulfilled or delivered so PayPal can best protect you against complaints and swiftly resolve the issue. 


It’s always nice to know someone has your back, right?


So How Does it Work?


To gain access to PayPal Seller Protection you’ll need to set up a PayPal Merchant Account


When PayPal's Seller Protection program applies, you may be able to retain the full purchase amount. PayPal reviews the claim and determines whether it is eligible based on requirements and any other information/documentation provided during the resolution process. It is in PayPal's sole discretion to determine whether your claim qualifies or not. 

Is my transaction eligible for PayPal Seller Protection?


In order for the transaction to be eligible you must meet the basic requirements and any additional conditions based on circumstance or transaction type. Find a full list here.


Using the same link, you can see requirements for establishing proof of shipment or proof of delivery for both physical and intangible goods, as well as what is NOT eligible.

What do I do if a buyer claims their payment was unauthorized, fraudulent or they did not receive their item?


If a buyer claims their payment was unauthorized or fraudulent, you should:

  • Ask the buyer to contact PayPal
  • Provide all information requested by PayPal within noted timeframe
  • Provide a detailed description of the transaction

How is PayPal Seller Protection different from chargebacks and/or merchant account claims?


PayPal Seller Protection is a service that protects you from chargebacks and merchant account claims. It only applies to eligible transactions and is different from chargebacks and merchant account claims.

Example: If a customer files a chargeback with their credit card company after they make an eligible purchase on your website, PayPal will refund the payment amount (minus any fees) to you if you're able to prove that you delivered the goods or services as promised in your listing.


Best Practices to Avoid Complaints:

  • Communicate well with your buyers.

  • Be clear about shipping timeframes.

  • Ship only using reputable shipping partners who can provide online shipment tracking details.

  • Share shipping details with your buyers.


In conclusion, PayPal Seller Protection is a great benefit to your business. It can ensure that you don’t lose money due to buyer complaints or claims of unauthorized payments or fraudulent transactions. Position yourself for success. Opt-in to the PayPal Seller Protection program and sell with peace of mind! 


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