Friday, November 11, 2011

Space for Improvement in PayPal Dispute System.

Today I have noticed a need for the improvement in the Dispute System of the popular Payment Gateway system "PayPal".

Recently I sold a script to a Buyer and I clearly mentioned below Terms and Conditions in the invoice itself apart from communicating this message to buyer thro' email.

Terms and conditions

- The Discount is applicable only for this un-updated version of the script. i-e you can get this for $150 only if you buy it today (2nd November) before we start updating this script.
- Refund is NOT applicable at any situation, as we will provide the source code.
- Any further corrections and updations are NOT free. We can do any corrections/updations for additional charge based on hourly billing.

But, today I was surprised to see the Buyer was able to remove this $150 from my PayPal account using "PayPal Dispute". I didn't like this paypal's behavour. Why paypal is reducing my balance while I clearly mentioned as "Refund is NOT applicable at any situation" in the Terms and Conditions of the invoice?

I couldn't understand why PayPal is supporting the buyer who is NOT respecting its "Terms and Conditions" feature.

The worst thing is, because of this dispute PayPal had cancelled my last Bank withdrawal. I will be losing significant amount because of the exchange rate difference during this cancellation.

I think PayPal Dispute System can be improved further. For example, apart from providing text area for entering free text for "Terms and Conditions" field, PayPal can provide a checkbox or radio button for specifying whether refund is allowed or not.

And, if the Seller chooses checkbox not to allow refund, the buyer should not be able to start the dispute for asking refund. Since the Buyer will be notified about "No refund" policy, it won't affect the Buyer. This feature will be very useful for the Sellers who sell digital products. I am NOT sure whether any disadvantage is there. You can share your comments about this suggestion.

I have asked PayPal Support to take necessary action against this Buyer who wastes my time without respecting the "Terms and Conditions".

I will update this post later once after I get the response from the PayPal support.

update on November 15
PayPal Support helped me to close the Dispute and I got back the Money.

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