On hold payment as a Seller - how Paypal can guarantee me?

[nvvkly]

Hi everyone! decided to ask here even if this has been mentioned a few times now. Forgive me because Paypal help community is new to me, so I couldn't navigate all of my inquiries.

Background: I started a local small-scale business and got my first international buyer. I have been sending and receiving from Paypal for a while, but this is my first time transacting abroad. What I'm trying to imply is that I'm not a new user per se, but I created a new Paypal account solely for my business (I'm not sure if this is relevant)

The payment is currently on-hold in my account. I already know what to do to release payment(s) on hold and I know that this process is meant to secure the buyer. But as a seller, I would have to shoulder a huge sum of shipping costs while the payment is still on-hold... how can Paypal guarantee me?

"Add Tracking. Use one of our approved shipping carriers and we’ll release the hold approximately 24 hours after the courier confirms delivery to the buyer’s address. "

QUESTIONS:

1. After adding the tracking number and approved shipping carrier, what if the courier didn't confirm within 24 hours and what will happen to the payment? considering that this is an international shipment, it won't obviously deliver after 1 day...

2. Is there an alternative where the buyer instead confirms the payment on hold (provided with the shipping details) even if the parcel hasn't arrived yet? how long will it take for the confirmation to prompt on the buyer part and how long will it take for me to receive the payment? 

- above else, the buyer also doesn't know much about Paypal... what if (they) fail to confirm the payment will I still receive it, and for how long?

3. Can the buyer cancel the payment? I'm afraid in the case that the buyer refunds while the item is in transit--where it's too far to cancel. How can Paypal safeguard me with this?

Thank you so much. I hope to receive a reply as soon as possible 🙂 I would really appreciate it if you run me through the process or send relevant Paypal links that will answer my inquiries.

[sharpiemarker · Accepted solution]

@nvvkly 

> 1. After adding the tracking number and approved shipping carrier, what if the courier didn't confirm within 24 hours and what will happen to the payment? considering that this is an international shipment, it won't obviously deliver after 1 day...

PayPal releases the money within 1 day (or up to 3 days if there is a system delay/glitch) after shipment is confirmed delivered. PayPal’s api checks with the supported shipping companies’ api. For example, I received a payment and there is a hold, I ship tomorrow and when tracking gets delivered status, PayPal releases money within 1 day after delivery.

> 2. Is there an alternative where the buyer instead confirms the payment on hold (provided with the shipping details) even if the parcel hasn't arrived yet? how long will it take for the confirmation to prompt on the buyer part and how long will it take for me to receive the payment? 

- above else, the buyer also doesn't know much about Paypal... what if (they) fail to confirm the payment will I still receive it, and for how long?

Yes, there is a confirm receipt option but not always depending if the transaction is deemed high risk by PayPal and it is up to the buyer to confirm or not. The confirm option appears after 48 hrs from payment date. If buyer does not confirm, you have to wait until 1 to 3 days after delivery or 21 days. You can also contact customer service to manually release a payment if the system is stuck after 1 to 3 days after delivery or 21 days after payment date.

> 3. Can the buyer cancel the payment? I'm afraid in the case that the buyer refunds while the item is in transit--where it's too far to cancel. How can Paypal safeguard me with this?

A completed payment cannot be canceled however a buyer can report a problem with the transaction within 180 days from payment date. This will open a dispute and put the payment in a dispute hold pending the outcome of case in addition to the “On Hold Payment” hold.

That’s where you have to keep open and caring communication with your customer to get ahead of potential problems. To be professional.

Develop a best business practice to handle shipping inquiries and problems.

Think about shipping insurance or even self insurance (setting aside a percentage of each sale towards covering the occasional refund or budget loss into your expenses. And loss may even be written off in taxes. Consult a tax advisor about that.)

When you send a shipping confirmation after an order is shipped, that is the best opportunity to outline what a buyer should do if delivery is taking longer than usual or other issues to try to avoid a PayPal dispute.

I am sure you have made purchases with big professional retailers online and see how they handle and communicate with you as a customer. Just copy them. 

Safeguard? PayPal is not a babysitter unfortunately. They expect you to get it together and handle your business otherwise your customers are going to be unhappy and that makes PayPal unhappy.

PayPal Seller protection only covers claims of item not received, buyer’s remorse or unauthorized transactions. And you need proof of delivery for not received or unauthorized transactions. For not as described items, sellers are forced to accept return for a refund except when there is a clear case of buyer’s remorse, and buyer will have to work with you on those.  Even then, PayPal has sole discretion on whether to cover you or not.

Buyers usually pay for return shipping and need proof of delivery for return to receive refund.

Chargebacks through buyers credit card or bank is outside of PayPal’s control so if the card issuer or bank sides with their customer after you respond to the chargeback through the Resolution Center, PayPal is forced to refund them and you’ll be liable.

There’s plenty of blogs/articles online about how to best handle any business problem you can think of. Make best use of them. Every time you encounter a problem: research, learn, adjust and improve on your business practices to avoid similar problems.

Good luck.