Sellers got bad news on Wednesday, learning that PayPal will no longer credit any fees when they issue refunds for returns or other reasons. PayPal had originally notified sellers of the change in its User Agreement back in April, but a month later said it would not change its policy "at this time."
Today, sellers learned PayPal will institute the policy change on October 11, 2019.
"I think this is a reversal of a reversal," one seller told us, "but I'm not sure if I am ahead of the curve or behind it on this PayPal policy."
The news hits as sellers are busy gearing up for the busy holiday season with little time to shop around for a different payment processor. eBay sellers, of course, have little choice in what payment processor they use - most are forced to use PayPal, some are being encouraged or forced into eBay Payments.
One seller wrote on the eBay discussion boards
today upon hearing the news, "Then Ebay should refund the fees when a buyer changes their mind or the buyer gives a bad address." Another seller wrote, "Sellers in (Managed Payments) will be credited payment processing fees even if the buyer used PayPal to pay. I am in the program and verified this with the payments team" - but one seller was skeptical that would be the case.
When the policy was first announced in April, a reader said not only would returns cost more, but cancellations for any reason would cost more, as would partial refunds to buyers, including in cases of overpaying for shipping. "It is just going to cost sellers MORE MONEY," the seller wrote, one of 110 comments left on the April EcommerceBytes Blog post
We saw several questions today about the following statement in the notification email: "This policy will not apply to duplicate transactions, voids and most disputed transactions." We've emailed PayPal asking for clarification.
Here's the text of the email PayPal sent out to users today:
Earlier this year, we notified you that we were updating our User Agreement to change our refund policy. We want to let you know that the policy change is going into effect beginning on October 11, 2019.
In line with industry practice and according to our updated policy, we will not charge a fee to process refunds, but the fees from the original transaction will not be returned. This policy will not apply to duplicate transactions, voids and most disputed transactions. You can review the PayPal User Agreement for more information on our return policies.
We only adjust our policies when we are confident the changes are fair and aligned with the value that our services provide to your business.
PayPal brings you more than just payment processing – your business has access to our platform's full suite of tools, products and support built to scale with you, such as customized invoicing to help you get paid sooner, access to business loans, world class fraud monitoring, seller protection for eligible transactions, and business services designed to simplify your day-to-day operations.
PayPal invests in bringing you buyers – with over 268 million active account holders worldwide, PayPal works hard for your business to make sure we continue to bring your buyers the shopping experiences they have grown to associate with our brand. PayPal is the most-used digital wallet** and PayPal shoppers complete their checkout 88% of the time on average, helping you close more sales.+
If you have questions about any of these changes or your account, please don't hesitate to get in touch with us.
Thank you for being a PayPal customer. We appreciate your business and look forward to continuing to help you grow and succeed in the future.