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PayPal's Seller Protection Policy is a farce, and at least one PayPal employee admits it.
PayPal's SPP: The Seller Punishment Policy

PayPal's Seller Protection Policy is a farce, and at least one PayPal employee admits it.
By PayPalSucks.ORG
Created 10/19/2005

PayPal made a huge mistake when it published one of it's pages on the web with some internal comments still included. The comment was, "too strong I think given the limited ability to comply with SPP." (Referring to the PayPal SPP, i.e., Seller "Protection" Policy, but we call it the Seller Punishment Policy.) It's supposed to help sellers from being ripped off. However, it doesn't work because it's impossible to comply with all the requirements of the SPP. For some reason, there was only a little media coverage and it focused on the mistake, not the admission or what it meant.

To be covered on the Seller Protection Policy at Paypal, all of the following conditions must be met:

  • Only the first $5000 in contested sales are covered per year.

  • You must be a Verified Business or Premier Account.

  • Only good if both parties are from: US, UK or Canadian.

  • The payment is listed as "Seller Protection Policy Eligible" on the Transaction Details page. How do you know if it's "eligible?" I could find no "eligibility requirements" on the PayPal site. Here is how they say to check:

      "To see the Transaction Details for a payment, log in to your PayPal account and click the History subtab of the My Account tab, then click the Details link next to the transaction in question. If a transaction is not listed as "Seller Protection Policy Eligible" it will not be covered under the Seller Protection Policy

  • Click here for a sceen shot


    Our take on the SPP!
    Easy, right?! Make sure to check every payment you get!

  • Seller must ship to the address listed on the Transaction Details page.

  • Seller must ship to the confirmed address listed on the Transaction Details page. Be sure to make sure it's confirmed, just being listed is not good enough.

  • The confirmed Address must be the address at which the buyer receives their credit card statements, or an address of the buyer which PayPal has confirmed outside the credit card system. Of course you as the seller have no idea how to verify this, but you have to do it anyway to be covered under the SPP.

  • Seller must get signature of buyer, (if value is over $250) at the confirmed address that matches address shown on transaction detail page, and is at the same address that the buyer receives their credit card statement and the signature must be of buyer/paypal account holder.

      So the UPS and Fedex "driver release" will not cut it. Having grandma sign for it won't cut it. You must send it restricted delivery, to the addressee only and that addressee has to be the paypal account holder, and it has to be confirmed by paypal and it has to be confirmed to be the address that the account holder recieves their credit card bill.
  • You must send the item within 7 days of payment. Send it on day 8, and you lose.

  • Seller must have tracking that shows address shipped to, and it must match the confirmed address listed on the transaction detail page. But wait... that's impossible. No shipper shows the address shipped to. It only shows the city and state.

  • The tracking number verification must be available online, and it must show the ship to address and it must match the paypal account holder, and it has to be confirmed by paypal and it has to be confirmed to be the address that the account holder recieves their credit card bill. Again, no shipping company provides the address via their online tracking. (Probably due to privacy issues.) They only provide the state and city. So it's impossible to comply with this condition of the PayPal SPP, thus the seller protection policy is a farce! Now you know why someone at PayPal made the comment, "too strong I think given the limited ability to comply with SPP." Because no matter how hard you try to comply, it can't be done!

  • You must reply to paypals requests within 7, or as few as 3, days. If you miss it by one day, you lose.

    If any one of these conditions are not meet, you lose! How many items have you shipped that meet everyone of these requirements? None! You can't, because UPS, Fedex and the Post Office, do not show the ship to address in their online tracking report! And even if they did, you have to send it restricted delivery to the account holders name.

    Now you know why PayPal's own employee admitted their users have a "limited ability" to comply with the SPP! But wait, there's more! Now that you know PayPal's SPP is designed to be impossible to comply with, you get to find out why they do this. Hint: It's all about the money.

    Discuss this problem in the forums or go back.

    Information taken directly from PayPal's Terms of Service, aka, User Agreement