Chargeback Protection Tool

Chargeback Protection Tool

The Chargeback Protection tool* helps reduce the risk of fraudulent credit and debit card transactions, with the added assurance that if a fraudulent or product not received chargeback is received on an eligible transaction, as long as required evidence is provided by the merchant, the PayPal chargeback fees** and disputed amount will be waived. Without the Chargeback Protection tool, merchants processing debit and credit card payments on Braintree are responsible for any transaction risk decision making, and are liable for all associated chargebacks. Availability for the Chargeback Protection tool varies by country.

Fraud Evaluation and Chargebacks

With the Chargeback Protection tool, PayPal provides a risk evaluation and decision on each credit and debit transaction. If a transaction is not deemed fraudulent/high risk, PayPal will process the payment. If a transaction is considered high risk, PayPal will decline to process the payment. There is no option to process a payment if PayPal declines the transaction due as part of this risk evaluation. All risk decisions happen in real time, with no manual review or later re-review of declined transactions.

When the Chargeback Protection tool is enabled, if a fraud or product not received chargeback is received on an eligible transaction*, PayPal will waive the PayPal chargeback fees** and disputed amount, as long as required evidence is provided by the merchant.

When an eligible chargeback is received, you’ll receive a notification and be asked to provide proof of delivery or shipment. Evidence requirements may vary based on the types of goods or services you provide. For more information see here.

Required Transaction Data

Your business’s risk profile is based on a number of factors that may include your geographical region, the types of goods or services you sell, or how long your business has been operating. PayPal takes an individualized approach to risk management, and will ask that you provide risk data tailored to your industry using our Set Transaction Context (ASC) API. For more information about the STC requirements for your business, please contact us.

In addition, PayPal uses device information to help evaluate the riskiness of a transaction. Using PayPal’s client-side device data collection tools, you’ll be able to share this information as part of the transaction flow, helping to ensure higher, less risky authorization rates.

Transaction Statuses

If PayPal declines a transaction with a Chargeback Protection tool enabled, there is no option to override or bypass this decision. Approved transactions will display their protection status in the Premium Fraud Management Tools section of the transaction detail page.

Managing Chargebacks

When a chargeback case is created, you will be notified that the case is open, and will have the option to submit evidence for that case.

All chargebacks will include an indicator called Dispute Protection Level. If the Protection Level is “Chargeback Protection tool,” simply provide proof of delivery or shipment through your API integration or through the Control Panel. Not all chargebacks are eligible for the Chargeback Protection tool, including, but not limited to, chargebacks with the reason code “Not As Described.” For these cases, the Dispute Protection Level is indicated as “No Protection.” You should respond to these cases according to the guidelines described in Braintree’s Disputes Guide.

Evidence Requirements by Reason Code:

In some cases, we might contact you after you have submitted evidence to request more information. Be sure to respond to these requests as directed to ensure the chargeback is eligible for the Chargeback Protection tool. Typically, when we request additional evidence, it is because we have encountered a problem with the evidence you submitted. These problems may include:

• The evidence you submitted is for a different chargeback/transaction;
• The evidence you submitted does not contain proof of delivery;
• The evidence you submitted is not legible; or
• The proof of delivery you submitted indicates the product was not delivered.

Payment methods supported

In regions where Chargeback Protection tool and Effortless Chargeback Protection tool are supported, these tools are compatible with debit and credit card transactions. Other payment methods are not available for the Chargeback Protection tools at this time.

* Terms apply to the Chargeback Protection tool. Certain transactions and chargebacks are not eligible for the Chargeback Protection tool. See Terms for details.

** You may be assessed additional chargeback fees by acquiring banks and card networks, which will not be waived but will be passed through to you at cost.