Is paypal a threat to online freelancers?

[Siruthuli]

After someone tried to "scam" me twice using paypal, I want to ask this question to everyone else.

My Story
"A guy asked me to do "x". I started doing "x" for him. He paid me $y as soon as I started. 3 days later he disputed it as unauthorised. I phoned paypal and told them what happened, the product you sold is an intangible item and it is not valid to be under the seller protection. So the $y was removed from my paypal account and all the work which I had done for him until them, had gone to waste!"

Paypal is using a fancy word, called "tangible". Anything which is intangible will not be under their seller/buyer protection.

So let's say you do some work for someone, you sell a domain, you sell your own script, you sell a website via paypal.

If the person disputes saying the payment was unauthorised, it is the end for you. All they had to do was use a proxy to send the payment to you via paypal and then they would dispute that the payment was unauthorised and you would have to fully refund the person without no choice. Whatever the situation, paypal will remove the money from your account without question, and you possibly would end up in a negative balance, which you have to pay off.

I feel this will be a great threat to many of the freelancing workers here, who design, make etc... all things which are intangible and things which people can easily dispute and claim money for.

Overall:
Is there a way to overcome and prevent people from doing such things, via paypal or by using another payment service which does not allow people to "scam" others like this.

Please let us know if you know any ways of doing this.

Thank you,

Siruthuli Reviewed by Siruthuli on 25th Feb 2012. Is paypal a threat to online freelancers? After someone tried to "scam" me twice using paypal, I want to ask this question to everyone else. My Story "A guy asked me to do "x". I started doing "x" for him. He paid me $y as soon as I started. 3 days later he disputed it as unauthorised. I phoned paypal and told them what happened, the product you sold is an intangible item and it is not valid to be under the seller protection. So the $y was removed from my paypal account and all the work which I had done for him until them, had gone Rating: 5

[LEVAC109]

Haha, it's not just freelancers. Happens to hostings too. After x amount of days, buyer decides oh, I found a cheaper host and BAMM! gone and "unauthorised" the payment and Paypal is like "Oh! this dude's account was hacked, let me help him take his money back from the seller, BAMM". Lolz. Paypal is getting stupid when you're actually doing seriously legit sells.

[msk19994]

Virtual product transactions are not good as people scam alot by them showing useless proof

[damnyou]

I agree. Paypal is full of shit. It happens with me almost every month. In total I lost 700$ this month, 300$ for charge backs and 400$ for zpag.es scam. Shit happens.

[MilliR]

Try escrow

[foxman]

hey, paypal is shitty, but still No. 1 payment processor.

[-Im.z2ight-]

Every system has flaws.

[t3od0r]

I agree. Paypal is full of shit. It happens with me almost every month. In total I lost 700$ this month, 300$ for charge backs and 400$ for zpag.es scam. Shit happens.

What has paypal to do with zpag.es scam?

@OP I never had issues with paypal. I sold a few scripts. I didn't had many claims, but on the ones i had i allways won.

[ShareShiz]

yup. i had someone the other day try to order $100 worth of backlinks. i was about to start the order and then i get a cancel notice. had to talk to paypal about it and i was forced to give the guy a refund.

at least it was canceled within 24hours and nothing was lost