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Difference between a PayPal Chargeback , Dispute and a Claim

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  • Difference between a PayPal Chargeback , Dispute and a Claim


    This article is meant for basic understanding on ChargeBacks and Disputes happening at PayPal. It's brief but informative.

    Let us see what a PayPal ChargeBack, a Dispute and a Claim is. Also, it'll outline the difference between each.

    1. Chargeback :

    The users making a payment through and funded with credit or debit card are liable to initiate a Chargeback. A Chargeback occurs when an already cleared transaction is reversed by the credit card issuer on request of their buyer.

    Below are the reasons triggering a buyer to file a Chargeback :

    i. Buyer noticed an unauthorized payment done using the card.
    ii. The buyer didn't receive the good/item that was purchased.
    iii. The good/item vary in description and does not match.

    2. Dispute :

    A PayPal Dispute is the primary step of the PayPal buyer grievance/complaint process.
    A buyer may open a dispute on the grounds similar and responsible for a Chargeback.
    At this stage, disputes opened by buyers are discussed in the PayPal Resolution Center by buyers and sellers. Following 4 points are applicable and should be kept in mind before opening a Dispute.

    i. The buyer is eligible to open a dispute within 45 days from the date of payment.
    ii. No transaction older than 45 days is liable to be disputed but should still be reported.
    iii. Prior filing an official claim with PayPal, a buyer should open a dispute and try to resolve the issue directly with the reseller.
    iv. Dispute once closed can't be reopened or escalated to a PayPal Claim.

    3. Claim :

    A PayPal Claim is the secondary step of the PayPal buyer grievance/complaint process.
    The buyer may handover the dispute to a Claim under the situation the buyer and the seller fail to resolve the dispute by themselves. PayPal then reviews the claim and gives the final decision.

    Even though a Chargeback and a PayPal Claim appear akin to each other but in fact, a Chargeback is a process carried outside of PayPal. Action of Chargeback is granted to a cardholder by the card issuer bank/company.
    Last edited by Katherine; 02-11-2011, 09:48.

  • jameshouston135
    hmmm this is very nice guide i highly appreciate the difference which you define here is trully nice specially for those who still have no idea about these differences, however here i found another link which was really awesome to understand about all pros & cons of chargeback @

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