A Bad Experience in Accepting Payment with PayPal Unverified Buyers Resulting to PayPal Chargebacks

A Bad Experience in Accepting Payment with PayPal Unverified Buyers Resulting to PayPal ChargebacksIn my aim to earn more money online, I have tried selling mobile phone e-load online. The e-load is a great business if done properly. But I could say that selling e-load is susceptible to credit card fraud. So this is my story.

Last March, 2011, I tried selling mobile phone e-load. I made my landing page and make a button from PayPal so that I could accept payment thru PayPal. After making successful SEO ( Search Engine Optimization ) with my landing page as well as social media marketing, lots of orders came to my e-mail. Most of my orders came from an Indian e-mail from PayPal. So after receiving their payment thru PayPal, I begun sending the e-load number to the e-mail they used in buying through PayPal. But it is a big mistake not to make sure that my buyers are verified buyers.

I sold a total amount of $ 400 with a capital of $ 300  until I realized that I am running a bad business.

I got different PayPal chargeback, here is an excerpt of what is chargeback :

A chargeback, also known as a reversal, is when a buyer asks their credit card issuer to reverse a transaction after it has been completed. It is available only to users who make a payment funded by their credit or debit card.

There are three main reasons a buyer will do this:

  1. The purchased item never arrived.
  2. The item was much different from advertised.
  3. Their credit card was used without their permission to buy the item fraudulently.

Chargebacks are initiated and handled by the buyer’s credit card issuer – not by PayPal – and will follow that company’s regulations and timeframes. That said, PayPal often plays a role in resolving chargeback disputes.

It is a reversal of an amount paid. The amount will be removed from your present PayPal account balance. It happen because the credit card company notifies PayPal’s merchant bank and debits the funds from PayPal due to fraudulent use of the credit card, which only means that somebody might have use a stolen credit card details and use it to buy an e-load by using a PayPal account.

I have made an e-mail captured of all the chargeback that I received fro

m PayPal below :

A Bad Experience in Accepting Payment with PayPal Unverified Buyers Resulting to PayPal ChargebacksThis is some tips from PayPal on how to dispute a chargeback:

How do you dispute a chargeback?

If you wish to dispute a chargeback, you will need to provide certain information and evidence depending on the case. Below are the two most common reasons for chargebacks and the information you need to provide in each case:

1. The buyer didn’t receive the item
You must give either:

  • A tracking number as provided by Royal Mail Recorded Delivery and Parcel Force 24
  • Proof of a refund – this can be evidence from your PayPal account, the back and front copy of a cheque, or a money order used to reimburse the buyer

2. Unauthorised use of credit card
You should give:

  • Tracking number for delivery of the item
  • Proof of a refund – this can be evidence from your PayPal account, the back and front copy of a cheque, or a money order used to reimburse the buyer
  • Any communication from the buyer, such as emails or positive feedback on eBay
  • Any contracts signed or information on the sent item
  • Date that the item was sent and the address it was sent to
  • For intangible items or subscriptions – any information about the item or service

In these and all other chargeback cases, the more relevant information you can give, the better your chance of winning.

Sad to say that I don’t have such details since my transaction are all electronically done. I cannot prove that I have delivered the item by just merely sending them a copy of the e-mail conversation that I had with the buyers. All my claim to get the amount failed.

The worst thing is that some forum says that a chargeback has a time limit of 1 year. It only means that any seller could receive a chargeback after a year of transaction, which could definitely drain the business. I am still thankful to God that I have known this thing before it can cause me much damage in my business.

So I will make a suggestion on how to safely receive payment for your online transaction if you are selling something on the net through my next post. if some of my readers do have some experience with PayPal Chargeback or credit card chargeback, please share it here so that we can gain more knowledge about this fraud. This might also be a reason other company such as Dreamhost is not accepting PayPal as an first payment. and one of the reasons why the PayPal withdrawal has been deactivated in India.

Good to tell my readers that whatever loss in this PayPal chargeback has been recovered thru my other online blog earning. I am just sharing this information to warn future seller which would want to use PayPal as their payment method. Check our partner site about Credit Card information

Dexter Panganiban https://techathand.net/about-2/

Dexter is a person who loves technology,new gadget, SEO, Social Media and Christianity. Follow him at twitter via @techathand and add him @ Google+ and contact us at [email protected]

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  1. 1

    My paypal account was hacked for almost $9000USD

    I managed to win 98% of the disputes that took me for about 7 months and 25K pesos worth of international phone calls + internet time + effort + headaches. I lost 8K more for same hacked account on which I lost the dispute.

  2. 3

    Hello there! Thanks for the info about the PayPal Chargeback. My plan pa naman sana ako na mag sell din ng e-load online and accept payments thru PayPal.

    But I have an idea 🙂 Kaso nga lang kelangan ko ng mid-range phone na pede mka connect sa PC ^^

  3. 6

    These issues are very rampant nowadays. There’s almost no protection against sellers that is why the scammer buyers are able to get away with it. 🙁

    • 15


      It might work, but the problem is that when they claim that they did not received the e-load, you will not have a strong case and will end up paying PayPal.

      But if is a tangible good, a signed receipt copy will always help to win a charge back.

      • 16

        @Dexter, kasi balak ko rin yan e…ung loading network/system na sinalihan ko merong “receipt” na sinesend pag nagload na kaya mukang ok pag triny ko (sana) 🙂

      • 17

        Actually those receipt will not mean anything kasi di naman kayang e relate ang phone number to the name of the owner. Pwede nilang sabihin na may gumamit ng credit card nila and use paypala to pay. Risky pa rin in my opinion.

      • 18

        @Dexter, I see. I guess, bank transfer or Smart Money or GCash or WU ang mas magandang option then.

    • 20

      @Paolo, paypal verification method has been made easier these days most especially with the help of virtual credit cards. Scammers could just use virtual CC to verify their paypal account.

      I think the best thing is now to engage in such transaction if you feel different about the person buying from you.

      I had this kind of experience before. I was scammed for several $s too. I stopped accepting paypal payment when I got to send e-load from paypal customers.
      better to accept other payment methods.

      Or you can require your customers submit proof of identification so that you will have their identities.

  4. 21

    well, after the incident, I only accept Unionbank online transfer when selling eload online.
    The business is temporary on hold for I am still thinking of other ways to reach the customers via an online eload store.

  5. 23

    I experienced the same when I started eloadshop.com. I actually saw the business very lucrative, but I am wrong. No choice but to stop accepting payments via paypal. 🙁

    sad thing was I was scammed by a fellow pinoy

    • 24


      But are you still in the business ?.. any tips on how you are accepting payment now a days. I would like to educate our fellow online marketers on how to sell safe online.

  6. 25

    i’m familiar with this fraud scheme. i’m from the banking industry and hadling fraud stuff and security matters. one of the reasons why you can’t buy eload using ATM card online 🙁

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