PayPal is extending its buyer protection to cover intangible goods, including digital goods and services. Like many payment services, PayPal currently offers protection only for purchases of physical goods, so it's a very big move. However, keep in mind that some marketplaces - including eBay, does not allow the sale of digital goods (except in the classified ad format
In PayPal's announcement this morning, it said beginning July 1, 2015, "if you pay for a service or digital product using PayPal and it is significantly different from how it was described, or you pay for one of these items and it is not delivered, PayPal will ensure that the money is credited back to your account."
PayPal said services include such things as hotel stays (presumably that includes purchases of airline tickets or services such as Uber).
But it's the digital goods part of the policy that will have sellers most interested. A PayPal spokesperson told us sellers will benefit because shoppers will have increased confidence. And in cases where there is no proof that the seller or buyer are at fault, PayPal will cover the cost of the purchase, she said.
How will PayPal determine if digital item is not as described?
"We will use a variety of methods to determine if a digital item is not as described," she said. "Since intangible products include everything from services such as hotel stays, to digital goods such as digital games - the type of evidence that is required will vary by the type of item purchased. Sellers can always reach out to our customer service team with any questions."
We asked PayPal if eBay did begin allowing the sale of digital goods in the future (beyond the classified ad format listings), would PayPal Protection cover those transactions? And, we asked, was there any reason eBay wouldn't start allowing the sale of digital goods after the breakup since it knows PayPal would protect them?
"While we cannot speak to eBay's future plans, we can confirm that we will cover any digital goods purchases made with PayPal at any merchant including eBay," the PayPal spokesperson said.
PayPal announced another extension to its Buyer Protection policy in the fall
that had sellers of tangible
Will this latest policy
impact you? If so, how, and what digital goods or services do you sell, and where? And how will you protect yourself from any false customer claims?