PayPal account charged before vendor confirmed shipment?

[Inojim]

Am I mistaken (or going senile!) or did I read somewhere that PayPal doesn't debit a user's account for a purchase until the vendor confirms shipment?  I ordered some items that may be on backorder for up to a year, but the vendor was paid immediately by my PayPal account.  Not a huge issue, I guess, I can always cancel the order and ask for a refund.  However, I'm willing to wait for a period for these items, but am afraid that if they never come I may be past the point of being to cancel the order and will have lost a hundred-bucks-and-change.  What's the policy?

[kernowlass · Accepted solution]

@Inojim 

No seller would send an item before being paid.

What you are thinking of is the new seller hold.

However even when that happens the buyer still pays and is unaware the funds are on hold as the hold is between the seller and paypal. Funds are released when tracking shows delivery OR 21 days post payment.

However you only have up to 180 days to open a paypal dispute for non receipt of item OR item not as described.

[Inojim]

Have now confirmed that seller does not bill PayPal until goods are sent.  In this case goods are on backorder and may be several months before they are shipped.  PayPal has my money, they debited my account immediately, but has a 180-day refund window.  I don't mind PayPal keeping my funds in the meantime, but if the goods prove totally unobtainable and never sent, will PayPal credit my account for what they withdrew or keep them because more than 180 days has passed?

[PayPal_Meghan]

Hello @Inojim and @kernowlass, 

Thanks for posting in the Community! 

I understand you'd like to learn more about how pre-orders work through PayPal, @Inojim. If your account was debited for the payment, then the money was already sent to the merchant. We will not place a long-term hold on a buyer's payment. I apologize, as it sounds like you were provided with misinformation. The only time PayPal will place a temporary hold on a buyer's payment is when the merchant processes a pending order. A pending order will place a temporary hold on funds, but we will not debit the money from your bank immediately. The order can last a maximum of 30 days before our system automatically voids it if the merchant has not completed the transaction. 

Regarding PayPal's Buyer Protection, as @kernowlass stated, you have up to 180 days from your payment date to file a dispute. You can file a dispute if you have not received the item, it's significantly different from what was expected, or if you have a billing issue. If you wait more than 180 days to open a dispute, we no longer have the ability to process a refund on your behalf. For this reason, I recommend filing the dispute at least a month prior to the end of your 180-day timeframe.  

I hope this helps! 

- Meghan

[Inojim]

Thanks for the clarification, Meghan, but I believe my experience here exposes a bug in the system.

I placed the order with Mouser Electronics for some parts that are in high demand. The expected ship date for new orders, like mine, is pessimistically a year away.

Had I used a credit card for this order, Mouser would not have debited the card account until the parts actually shipped.  As proof of the company's policy, here is an answer I got specific to this order:

==============================================

> Hello Jim,
> Thank you for contacting Mouser Electronics.
> PO# 25727896 part# 595-TPS560430YFDBVR is currently on backorder and has not been shipped yet.
> Once Mouser has shipped the requested parts that is when you'll be invoiced.
> Returned parts are refunded back to its original form of payment.
> Please let us know if we can assist you further.
> Best regards,
> Cheyenne Samuel, Mouser Customer Service
> MOUSER ELECTRONICS
> www.mouser.com

==============================================

And such has been my experience in the past with backordered parts; my credit card did not show the charge until the the parts shipped.  Perhaps Mouser put a 'hold' on the required amount with the credit card company, but funds were not sent from the card company to Mouser until shipment was made.

In this case, and because of the extended delivery time, PayPal's 180 days may well pass before Mouser ships.  And if the parts prove completely unobtainable, then because of PayPal's return/refund window, I could conceivably lose the amount for these parts, something just over $100.

Of course Mouser has been paid by PayPal.  As you said, "...the money was already sent to the merchant."  So I suppose my recourse would be to ask for a refund directly from Mouser, but I'm not sure how that would fit into their policy of not debiting the buyer's account until after shipment is made.  A PayPal payment and a credit card payment are evidently treated differently.

My worry is not having my money in the seller's hands until shipment is made and, after all, this is not a huge amount.  But in these cases of long backorder delays, perhaps either Mouser or PayPal needs to amend policy.

Thanks for your attention!

Jim Wood

Brea, CA