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Proving delivery of digital goods

Contributor

Proving delivery of digital goods

I just was scammed by a customer who purchased $350 worth of digital goods (custom sheet music), downloaded the files by clicking on links i provided, and then reported that the goods were never received. PayPal referred the issue to the cardholder’s bank, which probably means I won’t recover the money. So I’m thinking of adding some code to my website so that the customer has to jump through some hoops when they download the files, thus creating some proof that the customer actually downloaded the files. My question is: if I go through the effort and expense of doing this, will PayPal accept this as “proof of delivery” and side with me on chargeback disputes? Any thoughts would be welcome. Jeff Pepper Tunescribers.com

2 REPLIES 2
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Esteemed Advisor

Re: Proving delivery of digital goods


@JeffPep wrote:
I just was scammed by a customer who purchased $350 worth of digital goods (custom sheet music), downloaded the files by clicking on links i provided, and then reported that the goods were never received. PayPal referred the issue to the cardholder’s bank, which probably means I won’t recover the money. So I’m thinking of adding some code to my website so that the customer has to jump through some hoops when they download the files, thus creating some proof that the customer actually downloaded the files. My question is: if I go through the effort and expense of doing this, will PayPal accept this as “proof of delivery” and side with me on chargeback disputes? Any thoughts would be welcome. Jeff Pepper Tunescribers.com

One of the basic requirements for Seller Protection are: 

  • The item must be a physical, tangible good that can be shipped.

Ineligible items and transactions

Your sale is not eligible for coverage under PayPal’s Seller Protection program if:

  • It involves intangible, non-physical, items, including digital goods, and services.  Digital goods are delivered and used in an electronic format, like a song delivered online or through a mobile application.
  • The buyer claims (either with us or their card issuer) that the item you sent isn’t what was ordered (referred to as a “Significantly Not as Described” claim).
  • It involves an item that PayPal determines, in its sole discretion, is a counterfeit item.
  • It involves an item that you deliver in person, including in connection with a payment made in your physical store.
  • It involves sales that are not processed either through a buyer’s PayPal account or a PayPal guest checkout transaction. For example, if the sale was made using the PayPal Payments Pro/VT product, PayPal business payments or using PayPal Here, then it is not eligible for coverage. 
  • It involves items equivalent to cash including gift cards.
  • It involves a donation.
  • It relates to the purchase of a financial product or investment of any kind.
  • It involves a payment sent using PayPal’s friends and family functionality.
  • It involves a payment made using PayPal Payouts and Mass Pay.
  • The item is a vehicle, including, but not limited to a motor vehicle, motorcycle, recreational vehicle, aircraft or boat.

I suggest you look into getting chargeback insurance, preferably one that covers using PayPal if you continue to use PayPal. Or you can send a disc with a files via post with delivery confirmation. For $350 doing this would be worth it.


Kudos & Solved are greatly appreciated. 🙂
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Contributor

Re: Proving delivery of digital goods

Thanks for the helpful clarification.  I hope PayPal develops better ways to protect sellers of digital goods.  In the meantime, this unfortunately does not work for my business, and I will begin investigating alternatives to PayPal.

 

Jeff