Protect Yourself When Using Paypal

What Consumer recommends that you only use Paypal when absolutely necessary due to Paypal Buyer Protection limitations .

Where possible use a Credit Card for items over £100 to ensure the transaction is protected by Section 75 of the Consumer Credit Act. This makes the credit card company equally liable if there is a problem. For purchases less than £100 use a Visa debit card to benefit from the protection provided by the Visa  Chargeback Scheme. However, if a trader only accepts Paypal, all is not lost:

Visa Card for Paypal Payments

When you use your Visa card you can make a claim under the Visa Chargeback scheme. An existing balance in your Paypal account can complicate this, as it makes it more difficult to show that a Visa debit card was used for a particular purchase. It is important to note that you must make the claim within 120 days of the transaction.

Paypal payments using credit cards other than Visa are not protected by section 75 of the Consumer Credit Act.

Buy from UK Sellers

Buying from UK traders gives you the benefit of a number of consumer rights. These rights apply across the EU, but it is fair to say it is easier to enforce these rights and resolve disputes with sellers in the UK. Caution is needed as it is not always immediately obvious which country a company is trading from and pricing in pounds does not always mean they are UK based.

Paypal Buyer Protection

If you didn’t use a Visa  card, and didn’t buy from a UK trader then you have to rely on Paypal Buyer Protection.

If Paypal has closed your dispute and you are not happy with this then the only option open to you now is to take your complaint to the Financial Ombudsman (FOS).

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3 comments… add one
  • Tony 26 March, 9:55 pm

    This will be of interest:

    Status of PayPal

    As of 2 July 2007, a new PayPal company, PayPal Europe Sàrl & Cie, SCA (PayPal Luxembourg), became the service provider for PayPal in the EU. This entity are regulated by the Commission de Surveillance du Secteur Financier (CSSF), the Luxembourg equivalent of the FSA. PayPal Luxembourg is now the provider of PayPal service throughout the EU. PayPal now passports its service into the UK. If you wish to report the conduct of PayPal, you should contact the Luxembourg regulator with regards to this matter. Further details can be found at:

    If you have a claim/complaint against PayPal, you should contact them in the first instance at the following:

    Attn: PPEL Customer Complaints
    PO Box 9473
    Dublin 15

    Tel: 00352 2663 9100

    Regardless of the fact that PayPal is based in Luxembourg, UK consumers still have access to the Financial Ombudsman Service (the Ombudsman) if their complaint cannot be resolved with the firm directly. The attached guide ‘Just the facts about making a complaint: provides further information on the complaints procedure, including contact details for the Ombudsman.

  • Chris 10 September, 5:24 am

    After being a buyer via Ebay/Paypal Verified for for more than 10 years I recently decided to ‘sell’ for a change. The sale went through for £200 but after a month the buyer decided they were not happy so ask for return. I agreed but immediately Paypal tried to take the funds from my account but claimed they could not as my ‘CREDIT CARD’ would not accept (I recently cancelled my Credit Card since I was using my bank account with Paypal) the funds WERE available in my account. I tried using Bank transfer but then found that Paypal would not ‘clear’ that for 5 working days despite it being an ‘instant’ transfer. Now I find I cannot use my Paypal account during this period no matter how much I try to transfer simply because none of it will clear in time to complete my existing purchases. Sadly my seller only offers ‘Paypal’ as a payment option so now I am forced into a failure to pay scenario simply because of Paypal and nothing to do with funds.

  • James McGuire 24 October, 11:53 pm

    Bought in car camera from co called Roma and Florence they are crooks they will not answer my query re 12volt car supply Not suitable as their camera only works on 5Volt so useless how can I get my money back the return address ha 3 different titles!