PayPal Question: Any risk w/ unconfirmed address if NOT shipping?

[toadspittle]

We’re running a website that manages annual membership in a nonprofit organization. People pay their annual dues via PayPal, which then automatically updates their status in our member database, and gives them access to certain areas of the web site, etc.

We would like this to be as automated as possible. We don’t want to have to manually confirm anyone’s payment.

But a number of payments have been put on hold because of a PayPal security setting:

Block Payments for the items not sold on eBay from U.S. users who do not provide a confirmed address:

• Yes
• No
• Ask Me

Setting this to NO enables the payments to go through automatically. But everywhere I look, this setting seems to be a no-no. In our situation, though, I can’t understand what the risk would be.

Since we’re NOT shipping physical products, is there any danger in setting this to NO?

[Markxxx]

If you ship to an unconfirmed address you lose in a dispute.

But you have to look at it realistically. If you had a brick and mortar store you would not realistically expect to have no shrinkage (stealing). You have to budget for a certain amount of loss.

If you refuse to take payments from an unconfirmed address you may lose payments from people who don’t want to confirm their address.

I have not confirmed my address and if the seller won’t take it, they lose my business. A lot of people, for various reasons, won’t confirm.

The bottom line: In a dispute if the address isn’t confirmed you lose.

The question to ask: If I only allow confirmed address will I lose more business that way or from disputed charges.

You can’t take disputes personally nor can you prevent them totally. You have to minimize the risk

[toadspittle]

@Markxxx

If you ship to an unconfirmed address you lose in a dispute.

We don’t ship. That’s the point of my question.

[Markxxx]

Sorry I thought you were referring in general

For paypal protection

From paypal.com

In order to be covered for Paypal protection:
The item must be a physical, tangible good that can be shipped.

What is not covered

Services, intangible items, and digital goods

-------->

So you have no protection, as you’re selling a service. So you’re just gonna have to hope there are no chargebacks.

[Mr.Slant]

You’ve got no real exposure to cash lossses either. Your bandwidth expense due to thievery from a single user are minimal.

[Projammer]

One presumes that if there were some dispute to the charge that you would simply cancel the membership that it had been used to pay for. So unless you’re running some sort of service where someone could download a large amount of data between the the time the charge was accepted and when it was disputed I really don’t see a problem

[IAmNotSpartacus]

@Markxxx

If you ship to an unconfirmed address you lose in a dispute.

Untrue. Speaking from personal experience as a seller.

From the paypal user agreement:
https://www.paypal.com/us/cgi-bin/webscr?cmd=xpt/UserAgreement/ua/USUA

11.4 What are the eligibility requirements for PayPal seller protection?

You must meet all of these requirements to be covered:

* Ship the item to the shipping address on the “Transaction Details” page.

      o You may access the “Transactions Details” page by logging into your PayPal Account, selecting “History” and then selecting “Details” for the transaction.

* Follow the shipping requirements described below.

* Respond to PayPal’s requests for documentation and other information in a timely manner.

* The transaction must be marked eligible or partially eligible for seller protection on the “Transaction Details” page.

      o If it is marked eligible, protection for both Unauthorized Payments and Item Not Received will apply. If it is marked partially eligible, protection for only Item Not Received will apply.

      o Items sold on eBay will be marked eligible even if the shipping address is marked unconfirmed. Generally, items sold on websites other than eBay will be marked eligible if the shipping address is marked confirmed and partially eligible if the shipping address is marked unconfirmed.

* The item must be a physical, tangible good that can be shipped.

* Your primary residence, as listed in your PayPal Account, must be in the United States.

Also see:

11.3 Qualification Requirements. In order to qualify for coverage under the Seller Protection Policy, you must meet the following requirements:

1. You must have a Verified Business or Verified Premier Account at the time of the transaction,

2. The transaction must be between a US, UK or Canadian buyer and a US, UK or Canadian seller,

3. The payment must be listed as Seller Protection Policy Eligible on the Transaction Details page, or cleared by PayPal through Payment Review,

4. You must accept a single payment from one PayPal Account for the purchase,

5. You must not charge a surcharge for accepting PayPal,

6. You must ship the purchased item to the address listed on the Transaction Details page,

7. You must ship the item to the buyer within 7 Days of receiving payment. Or, if you are selling a made-to-order or pre-ordered item on eBay, you must ship the item within the time-frame you specified in your eBay listing as long as the buyer agreed to the extended time-frame at the time of payment.

8. You must have trackable online proof of delivery from an approved shipper to the address on the Transaction Details page. For transactions involving $250.00 USD or more, you must provide a proof of receipt that was signed or otherwise acknowledged by the buyer and can be viewed online, (If you paid in a currency other than US dollars, the following amounts apply for this section: $325.00 CAD, €200.00 EUR, £150.00 GBP, ¥28000.00 JPY, $350.00 AUD, 330.00 CHF, 1,600.00 NOK, 2,000.00 SEK, 1,500.00 DKK, 800.00 PLN, 55000.00 HUF, 6,000.00 CZK, $400.00 SGD, $2,000.00 HKD, $380.00 NZD, $2,750.00 MXN, 1,000.00 ILS), and

9. You must respond to PayPal’s requests for information within the time period PayPal specifies.

10. Additional qualification requirement for unauthorized payments: The address on the “Transaction Details” page that you ship to must be a Confirmed Address. This requirement does not apply to Chargebacks due to non-receipt of merchandise.

Please note that in order to qualify for our Seller Protection Policy you must ship the item as required in this section. If you hand deliver an item, or provide delivery in any manner other than required in this section, your transaction will not qualify for the Seller Protection Policy.

[toadspittle]

@Projammer

One presumes that if there were some dispute to the charge that you would simply cancel the membership that it had been used to pay for. So unless you’re running some sort of service where someone could download a large amount of data between the the time the charge was accepted and when it was disputed I really don’t see a problem

No, not at all. Our online members-only offerings are very light—an industry- and locality-specific job postings list that has been compiled mostly from public sources, and the ability to communicate with other members in various ways.