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How to Fight a PayPal Chargeback in 2024? (Manage Claims, Disputes, and Chargebacks!)

PayPal is everywhere and allows making sales and payments in a jiffy. PayPal processed over 5.61 billion transactions in the fourth quarter of 2023, adding 9.3 million new active accounts, and its total number of accounts stood at 426 million in Q4 2022.

The figures are imposing as PayPal is currently viewed as the staple of a secure way to transact from any part of the world to another to buy and sell products and services and much more.

PayPal has a few policies up its sleeves that prevent both buyers and sellers from fraud, and one such technique is called a ‘PayPal chargeback’, which keeps the interest of buyers in case of any invalid payments.

But chargebacks have become a common way to fraud merchants, and it is exponentially increasing. So, how to fight a PayPal chargeback in 2023?

Here’s everything you need to know about chargeback and how you can take measures to prevent and fight it.

What is a PayPal Chargeback?

As PayPal quotes it, a chargeback is “initiated by the customer when he/she contacts the payment issuing company to get a refund or payment reversal. With a chargeback, the buyer is disputing a payment made starting either the payment went through unauthorized or when the seller ships an unwanted or damaged product and so on”.

Note that PayPal represents the seller/merchant, where it allows communication between the customer’s issuing bank and the seller. A chargeback can be disputed by providing all the required documents, proof of sales and shipping, etc.

Until then, PayPal holds the payment made to the seller and keeps it frozen until there’s a resolution to the chargeback. If the chargeback is valid, the seller loses the payment plus a $20 chargeback fee. The payment is processed to the merchant if the buyer loses the dispute.

How To File A Chargeback on PayPal?

A buyer can file for a chargeback on PayPal for different reasons, like when his/her PayPal account is used for an unauthorized payment. Other disputes include if a buyer gets a damaged or incorrect item, the box is empty, or if the buyer is charged twice for the product.

Further, buyers can file a chargeback if the product doesn’t arrive. Note that although not all chargebacks are fraudulent, it is a common Paypal chargeback scam that has caused quite a stir as people are using it for their excellent while causing massive losses to the merchants and sellers.

The process of filing a chargeback for Paypal in 2023 is simple. It usually involves a buyer contacting his/her debit or credit card issuing company to report an unauthorized transaction or alleging a series of other reasons listed above.

This is when the card-issuing company contacts PayPal and the steps mentioned in the “How PayPal Chargeback Works” take place until a resolution isn’t met.

How Does PayPal Chargeback Work?

PayPal Chargeback process
PayPal Chargeback process

To understand how to fight a chargeback on PayPal, you need to first understand how a PayPal chargeback works, so here we go:

  1. The buyer checks out a range of products/services and buys a product of his/her choice.
  2. In case the product was damaged, faulty, or any unwanted items or the product was never delivered, he/she can contact an issuing bank for a payment reversal (chargeback).
  3. The issuing bank (supporting both credit and debit cards) notifies PayPal.
  4. PayPal freezes the payment, deems it untouchable, and holds it until the chargeback request is deemed invalid.
  5. Both buyer and seller are notified about the chargeback, and PayPal asks the latter to provide all the documents, including proof of shipment, delivery slips, etc., to confirm it.

What is the PayPal Seller Protection Program?

PayPal Seller Protection is a policy created to protect all your transactions from chargebacks, reversals, and other related fees. If you sell something to a buyer, and they opt for disputing or reversing the transaction, you will probably be eligible to retain the full purchase amount.

And this entire process will happen while avoiding any related paid feed as a chargeback. It is applicable for debit and credit card transactions.

The PayPal Seller Protection program usually covers two types of buyers’ claims. Firstly, it covers unauthorized transactions when a buyer claims that he/ she didn’t authorize payment. Secondly, it offers cover for items that are not received.

If a buyer claims that they have never received their purchased item, the PayPal cover will protect them.

But the Seller Protection does not cover buyers’ claims for those items received which are “Significantly Not As Described (SNAD).”

In other words, if the buyer’s purchase does not match what they ordered, it will not get the cover.

However, the SNAD complaints are easy to reduce by providing a detailed description of your selling items. Also, communicating with the buyers, answering their item-related queries, and resolving issues are effective ways to get help.

How To Fight A PayPal Chargeback?

There are valid and accurate chargeback claims that buyers file with PayPal against a seller for a variety of reasons. It could be because they didn’t receive the product or it is different from what they ordered.

However, there is an ugly side to it, and that is using fraudulent techniques to get a chargeback. This often ends up bad for the sellers as they usually end up delivering the product, and the buyer gets his refund, plus there’s a chargeback fee that PayPal imposes on the seller and so on.

So there are ways in which you can fight the chargeback claim, which we have mentioned below:

1) Speak with the Buyer

It is estimated that over 40% of the chargebacks result from a merchant’s error. It can be easily solved by talking to the buyer and mitigating probable solutions. Settling any discrepancies via refunding with PayPal is better for the seller’s reputation and incurs fewer losses.

2) Check if Seller Protection Program covers the product

As said, check whether the Seller Protection Program covers the order. If yes, PayPal will allow the seller to retain the total amount when a chargeback is hit while waiving any chargeback fee. The sellers would need to provide documentation if requested.

3) Check out the Proof of Online Tracking

PayPal offers a secure platform for transactions. Even after that, it is subjected to fraud using different techniques. However, a great way to minimize chargeback by a buyer claiming an ‘unauthorized transaction’ as the cause is to check for proof of online tracking. A merchant’s dashboard has everything they need to track the transaction details if the sale is “eligible” or “partially eligible,” which can prevent them from losing the sale.

4) Check the Proof of Shipment or Proof of Delivery

One of the fraudsters’ standard techniques to rip refunds is using one of the many PayPal chargebacks 2023, like listing the product as ‘Item Not Received’. Here, the buyer states that he/she didn’t receive the product.

Since PayPal requires merchants to upload and keep the proof of delivery or shipment from an online shipping company. This ensures that the merchants have all the proof validating the delivery and can be used to fight Paypal chargeback disputes.

5) Response for the Chargeback Notice within 10 Days

Now, this is crucial. PayPal requires sellers to respond to any chargeback disputes within 10 days. They can go to the Resolutions Center to check if any customer orders any chargeback or dispute.

Responding quickly can help gain an advantage over those who would take days to respond. This way, you can check with the customer who has filed the claim and solve the issue as soon as possible.

6) Email PayPal with all Documentation

The best way a seller can respond to an invalid or fraudulent dispute is to provide all the documentation supporting the sale and delivery of the order.

The email should contain everything from communication details with the buyer, customer history, proof of shipment and delivery, and the likelihood that a merchant is working in good faith or a buyer is using fraudulent tactics to rip off PayPal’s chargeback feature.

7) Check the status

A chargeback can take as many as 75 days or more, depending upon the case. Here, sellers can check out the status of the dispute within the Resolutions Center. This makes it easier to track the status and provide any other documents or anything else that PayPal might request during the course until a seller wins or loses a claim.

8) Appeal the claim

This works if the seller losses the claim. Here, they can appeal to the claim, and there’s a possibility that the buyer either returns the items, although the condition could vary from damaged to incorrect items, etc.

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How can a Seller Manage PayPal Chargeback?

According to PayPal, being responsive and professional can help mitigate ongoing claims. The sellers can give accurate descriptions, pictures, return policies, and more to avoid getting entangled in buyers’ claims, thereby minimizing the risk of chargebacks and whatnot.

As said, a chargeback comes with a hefty $20 fee, and on the other hand, a refund would steer away from any further losses, although if the merchant is confident about the product delivered, they can respond to the claim and appeal for it to win it.

Taking added measures for orders coming from high-risk countries can also help minimize unauthorized transaction claims. On the other hand, sellers can minimize ‘Item Not Received’ claims by providing all the necessary information to the buyer and PayPal.

It includes, but is not limited to, updating the delivery dates and uploading the items’ status. Sellers must upload all the proof of shipments and delivery to ensure they are ahead of any unwanted chargeback scam that could cost them a lot.

Sellers complying with the Sellers Protection Requirements have a greater chance of minimizing claims and disputes. This ensures sellers retain the amount while the chargeback fee of $20 is also waived for covered items.

Also, a seller must be aware and avoid risky transactions that PayPal might not cover, such as any transactions for high-tech equipment or gift cards and a whole string of other products that aren’t covered under PayPal’s seller protection program.

Is a PayPal chargeback the same as a dispute?

The ideas of chargeback and dispute for PayPal may be cohesively positioned factors. But they are not the same. All the chargebacks come from disputes. But not all disputes are going to turn into a chargeback.

Most of the time, disputes begin when a cardholder focuses on their card statements and sees an unauthorized charge. Most of the charges usually come with identifying information with the credit card statement so that cardholders can contact you with questions in case they don’t recognize a charge.

If a cardholder cannot agree with the merchant, they usually contact the bank. This is usually known as a dispute.

Chargebacks, on the other hand, come with a dispute. When a dispute becomes a chargeback, it will be assigned a reason code. In case of a chargeback, the merchant becomes automatically liable. Thus if a merchant wants to fight back the chargeback and keep the money, then they have to provide evidence regarding the legitimacy of the charge.

We hope this article was helpful for you in learning how to fight a PayPal chargeback in 2023. We have other helpful guides and reviews as well on our website.

Frequently Asked Questions on PayPal Chargebacks (FAQ)

How does PayPal notify when a chargeback is filed against a seller?

When a buyer files a chargeback, the credit company of the buyer notifies the merchant bank of Paypal. Then the merchant bank informs regarding the chargeback, and Paypal emails the seller. Now, the seller can log in to their Paypal account to see the case status from the Resolution center and provide information regarding the matter.

Why do some chargebacks take a long time, even after receiving payment?

Specific laws and credit card issuer policies allow buyers to file chargebacks within weeks or months after the initial transactions occur.

Where can I get all the information about chargebacks?

To get help during the chargeback process, look at the Chargeback Guide of PayPal. Also, the Paypal Resolution Center offers a step-by-step guide on responding to a chargeback filed with a credit card company.

Alf Alferez
Alf Alferez
Dedicated writer with a strong track record of developing customer loyalty and managing general office operations. Enjoy being a part of a company where my skills and creative ideas will benefit the overall productivity of the organization. I have a strong desire to work in helping make the world a better place. Please reach out to me on

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