How To Deal With Paypal Disputes As A Streamer!
Updated: Jun 17, 2019
Making money while streaming is tough, especially when people chargeback and dispute the money they sent to you!
If you’re a Twitch, YouTube or Mixer streamer out there, you have most likely heard the horror stories of PayPal Chargebacks & Disputes! Because of these tall-tales, a lot of streamers choose not to have a tip or donation button on their channel pages. That’s a shame because you are not providing a way for your viewing audience to support you and your content. And trust me, it really doesn’t happen as often as it seems. In this blog post, I will give you and overview on how to deal with a PayPal chargeback and dispute. I’ll show you the best ways to protect the money you’ve made as a content creator on your channel.
PayPal chargeback horror stories typically start out with emails or notifications from PayPal letting you know that a payment you have received has been made without the account holder’s knowledge or permission or was the result of a transaction error. Many people that apply for a chargeback claim that they didn’t mean to send you money, it wasn’t them that sent the money or it was falsely sent. So what happens to your PayPal account when this happens? Most of the time the transaction will be cancelled and the funds will be taken out of your account automatically by PayPal. This can even happen days or weeks after the original transaction. By this time, you may have already spent any money in your account and your PayPal balance can go negative. But it’s not all doom and gloom because there are some things you can do to protect yourself.
When a sender or buyer wants to claim a chargeback, you’ll always get contacted by PayPal through your email address that’s connected to your account. Generally they will investigate the matter, which can take a week or two. Even though they do investigate, PayPal sides with the sender or buyer 98% of the time. This is because anyone can use the magic word “fraud” in their chargeback dispute. Because of the consumer protections that all banks and financial institutions have (PayPal is a financial institution), using the word “fraud” will almost always cause them to side with the consumer. This is frustrating for any streamer, but as we are all consumers as well, this kind of policy benefits all of us in the long run.
If you log into your PayPal account and see that there’s a chargeback dispute, the easiest thing you can do is to just refund the money and avoid the investigation. The dispute will close the case pretty quickly in this case. This is generally what I do, especially if the amount of money involved is pretty small.
However, you can fight the chargeback if you would like, but I don’t recommend it for streamers. There are cases where it is possible to fight it, especially if the transaction was for a physical good. Having a physical item that there was an exchange of money for involves providing an invoice or receipt and a tracking number to prove that the item was shipped and received. The issue with being a streamer is that streaming is a digital product which doesn’t have an invoice, a receipt or a tracking number. This makes it almost impossible to prove that there was an exchange of service from you (the streamer) to the sender (your viewer). If you can somehow provide proof of service you have a much better chance of winning the dispute.
But don’t let the possibility of a chargeback scare you away from providing a tip or donation button! Remember it doesn’t happen very often. And there’s a simple protection you can build into your workflow for yourself. Currently, PayPal has a 60 day statute of limitations on submitting a chargeback to them. After a transaction has passed its 60 day mark, the sender can no longer claim a chargeback. My recommendation is to let any tip or donation you receive sit in your PayPal account for 60 days and then move it to your bank account, spend it, do whatever you want with it. That way you will never be affected by losing money to a chargeback. It’s a simple budgeting strategy that will benefit you greatly.
Watch my video to hear about my personal experience with PayPal chargebacks and how I have dealt with them fairly painlessly and to get some bonus tips on handling PayPal Chargebacks as a streamer.
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