Sponsored Link
Email This Post Email This Post

Etsy Overcharges Buyers as Payments Go FUBAR

This month, Etsy experienced one of the longest-duration marketplace payment problems we can recall, and now the situation has taken another ugly twist as Etsy charged some buyers a second time for single purchases made several days or more than a week earlier.

As the latest problem grew over the weekend, Etsy did not acknowledge that it fully understood how bad the problem was, at first denying that funds were being withdrawn from buyers’ accounts a second time.

Etsy “explained” that buyers were seeing an authorization and an actual charge, not two charges: “Some bank and card statements show both the authorization and the actual charge, but you’ll only be charged once,…From what we’re seeing there is a slight delay with this authorization dropping. Either way, the authorization will soon drop from the statement.”

But according to buyers, funds were indeed being withdrawn from their accounts a second time. Some said their accounts were overdrawn as a result and would be charged fees, others said they had no money left in their accounts to buy necessities.

Once again Etsy failed to alert users to the payments problem on its announcement board or Status board. Instead, it responded to users on a thread on the Bugs area of its discussion forums. So unless users knew to visit the Bugs forum, they were left in the dark unless, as was the case for this seller, other users helped them out.

That seller reported on Sunday evening, “My customer was charged $740 twice for a direct checkout purchase and said he has contacted Etsy already. As a seller, who do I contact to have this resolved quickly. Its terrible customers need to go through all this trouble to get a refund. I can’t imagine those customers who don’t bother checking their bank accounts and don’t realize they were double charged.”

Since the funds removed in error from customers accounts did not end up in sellers’ accounts, they were unable to refund buyers for the duplicate charge.

Buyers turning to Etsy’s customer support account on Twitter (@EtsyHelp) were confused further. That’s because Etsy continued to respond to buyers on Twitter on Sunday by linking to a post from Saturday on page 2 of the thread that denied funds were being withdrawn a second time, adding to buyers’ frustration.

If Etsy had linked to page 1, users could have scrolled down to see subsequent posts in which it said it was investigating the issue. While none of the updates explicitly confirmed Etsy was seeing what buyers were describing, in a post before noon on Sunday Etsy said it had teams working on the issue “and we are in touch with our partners to get this issue analyzed and resolved as quickly as possible.”

Here’s a typical dialog between a buyer and Etsy on Twitter; the buyer’s initial post was made on Saturday, and Etsy responded on Sunday:

Etsy Buyer: @EtsyHelp I’ve been charged again for an order I placed a week ago & as a result I am now in my overdraft & will be charged daily. Not happy

Etsy Support: Hi there, this is from a payment authorization delay that should resolve soon. More info: http://etsy.me/29KlDNF . Thanks!

Etsy Buyer: @EtsyHelp Honestly, you’ve given every person the same weak reply. You’re not giving buyers OR sellers any confidence in you.

Etsy Support: I’m sorry about your frustration with this! Please DM us your Etsy username and order numbers and I will pass this info along.

Etsy Buyer: @EtsyHelp No it’s fine my bank sorted as you have taken too long as I can see DM-ing their username has helped anyone else.

One Etsy user shared a theory about the cause of the problem. “It’s like all those orders that were stuck in processing were pushed through manually, but someone forgot to turn off the automated process for them and so now they’re going through again because the system doesn’t know they were manually processed.”

She was referring to the mayhem that began on July 1st in which payments were hung up, and sellers had to deal with buyers upset at the delays. Etsy blamed its third-party processing service Worldpay for that problem.

On Sunday, some sellers said they began turning off Etsy Direct Checkout as they lost confidence in the checkout system, meaning their customers may be forced to pay with PayPal rather than using credit cards directly.

An Etsy spokesperson told EcommerceBytes that it is currently working alongside its payments processor to resolve this issue as quickly as possible and is also working to promptly issue refunds for any duplicative charges. “Etsy will be communicating directly with all impacted buyers,” according to the spokesperson.

Comment on the EcommerceBytes Blog.

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). She is a member of the Online News Association (Sep 2005 - present) and Investigative Reporters and Editors (Mar 2006 - present). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com. See disclosure at EcommerceBytes.com/disclosure/.