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PayPal to Pick Up the Tab for Holiday Returns

PayPal is launching a program in which it will pick up the cost of return shipping if a shopper is unhappy with their purchase. “Return Shipping on Us” is a program in which PayPal refunds return shipping costs to consumers on eligible online PayPal purchases from around the globe during the holiday shopping season.

The program is targeted to shoppers, who must opt in, and it applies to eligible purchases not only on a merchant’s own website, but on marketplaces such as eBay as well.

PayPal spokesperson Anuj Nayar said the program has no downsides for merchants. It doesn’t apply to fraud or item not as described claims, which are already covered under PayPal’s protection plans. Instead, the program applies to cases where a shopper didn’t get what they wanted despite the merchant accurately describing the goods – for example, an item was not the size or color the shopper had imaged the item to be when ordering it online.

PayPal is not sharing conversion data from the program that has already launched in other countries, but Nayar said anything that removes any potential concerns consumers may have when shopping by definition helps sales.

Here’s the key information for merchants who accept PayPal: “you don’t have to sign up for the service and your return process will not be affected.” It applies for sellers who don’t already offer free return shipping. Shoppers must opt in for the service on their PayPal account and pay for their order via PayPal to become eligible for the service.

So what’s in it for sellers?

PayPal said, “We know that pricey return shipping fees discourage more than half of online shoppers from making repeat purchases and 48 percent of American shoppers say free return shipping is a must before they’ll buy.”

“That means PayPal merchants can attract shoppers from around the globe who may have been previously concerned about the return shipping costs for returns or exchanges” – and PayPal says those customers can turn into repeat buyers after the holidays.

PayPal has already launched the program in over 30 countries including Australia, France, and Spain. In addition to launching in the US, the program is also launching in Italy, Malaysia, Russia, Singapore, and South Africa on Tuesday.

In the US, the service allows up to four refunds on eligible online purchases from October 12, 2015 to January 31, 2016. The company says, “If the customer’s purchase isn’t quite right and they would like to return it, PayPal will be there to help – from checkout, to return.”

Here’s fine print about the Return Shipping on US program:

“Return Shipping on Us Terms and Conditions: Exclusions apply. This is an exclusive offer offered to eligible PayPal account owners. With this service you are eligible for up to 4 refunds on your return shipping costs from October 12, 2015 through January 31, 2016 and may receive refunds of up to $30 USD per claim. PayPal reserves the right to cancel or modify part of or this entire Offer at any time without notice, for any reason at their sole discretion. See Terms and conditions.”

More information is available on the PayPal website.

Interestingly, Nayar said this is the fourth year that PayPal has seen a spike in transactions on September 30th. Even before Halloween, it would seem people are shopping for holiday gifts.

Ina Steiner on EmailIna Steiner on LinkedinIna Steiner on Twitter
Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com. See disclosure at EcommerceBytes.com/disclosure/.