PayPal chargebacks — officially called PayPal disputes and claims — work differently from card network chargebacks, but they're just as damaging. Here's how to fight back and win.
PayPal Disputes vs. Chargebacks: What's the Difference?
PayPal has its own internal dispute resolution process before a chargeback is filed with the card network:
- Dispute — The buyer opens a case directly with PayPal. You have a chance to resolve it before it escalates.
- Claim — If the dispute isn't resolved, the buyer escalates it to a PayPal claim. PayPal investigates and makes a ruling.
- Chargeback — If the buyer paid via credit card through PayPal, they can bypass PayPal's process entirely and go directly to their card issuer. This is the most serious and hardest to reverse.
Common PayPal Dispute Reasons
- Item Not Received (INR) — The buyer claims they didn't receive the item
- Significantly Not as Described (SNAD) — The buyer claims the item was materially different from the listing
- Unauthorised Transaction — The buyer claims they didn't authorise the payment
Step-by-Step: How to Fight a PayPal Dispute
- Respond immediately — Log into PayPal's Resolution Centre and respond to the dispute within 24 hours. Early engagement shows good faith and gives you more control.
- Gather your evidence — Tracking information, proof of delivery, transaction records, customer communications, and your terms of service.
- Submit a clear, structured response — Address the specific claim type directly. For INR, provide tracking. For SNAD, provide product photos and your listing description. For unauthorised, provide IP data and 3DS confirmation.
- Escalate strategically — If PayPal rules against you, you can appeal. For card-funded chargebacks, you'll need to respond through your card processor's representment process.
Key Evidence for Each Dispute Type
Item Not Received:
- Carrier tracking showing delivery to the buyer's confirmed PayPal address
- Signature confirmation where available
- Shipping confirmation email sent to the buyer
Significantly Not as Described:
- Original product listing screenshots
- Photos of the item as shipped
- Your returns and refunds policy
Unauthorised Transaction:
- IP address and device fingerprint data
- Login history showing the buyer's account was used
- Any prior purchase history from the same account
PayPal Seller Protection: Does It Cover You?
PayPal's Seller Protection programme covers eligible transactions for Item Not Received and Unauthorised Transaction claims — but only if you meet specific requirements:
- The item must be shipped to the address on the PayPal transaction details page
- You must provide proof of shipment or delivery
- The transaction must be marked as eligible in PayPal
SNAD claims and intangible goods (digital products, services) are generally not covered by Seller Protection — which means you need a strong representment case.
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