JVZOO- Paypal maximum refund rate

Rumors are just rumors, I doubt they freeze accounts for 1% refunds. What if you only sell 20 units and get 1 refund? that is a 5% refund rate.

I use JVZoo and every cent I have earned for several years now has gone through PayPal.

Ok first off PayPal doesnt give a crap about your refund rate. It could be 90% and they wouldnt really care. Refunds are not bad. In fact refunds can be considered a good thing (especially if your selling a digital product) .. how can it be considered a good thing? Well think of what a refund really is. Its a kindness to the buyer. He didnt like your product so you gave him his money back. No problem. Good customer service. This is especially true if its a digital product since there is no obligation what so ever to give them there cash back.

So to clerify refunds are no problem PP doesn't care about them.

Now 'disputes' .. well thats a whole different animal. A disput is a claim by the seller of fraud. PP doesn't want to see a large number of them.

brutecky nailed it. I would just add that Paypal likes to see enough money left in the account to cover refunds in the event of disputes. If you're in the habit of pulling all the money out as soon as it comes in and don't leave anything for refunds, they won't give you much leeway.

Paypal doesn't care about refunds if the refund rate is about 20% .. just maintain a healthy balance to cover refunds.

Refunds do not matter, it is charge backs that matter. If you are getting a lot of charge backs then you have something to worry about as it appears you are defrauding your customers.

Wow you are getting some terrible advice on here about refund rates and are just asking to have your account frozen. I have used paypal for years and as what they call a "high value" client I have an account manager that closely monitors my refund / chargeback rate as I have had my account frozen several times over the past decade and know from first hand experience their expectations and limits.

There are several factors they look at when it comes to account credibility. It begins with your reputation and track record in dealing with disputes. Secondly, they have a 3% ceiling on refunds filed via dispute - in other words people that couldn't get a voluntary refund. I have always found that a 7 to 10% refund rate was the norm with software so it was always a struggle staying below their radar.

Where I was having problems was with chargebacks - which was always frustrating as no amount of customer service can prevent these when a card is being used unauthorized - not to mention the heavy service fee charged back to you. Too many people are quick to simply call their credit card company and dispute the charge rather than dealing with customer service where we had a no questions asked refund policy. Anything over 1% chargeback rate will get you noticed by the security department - the moment you go over 2% you will be in danger of getting suspended.

In regards to having an acceptable balance to cover refunds etc - this does have an impact but is also based on your funds coming in. I've had paypal hold 12,000 after a security review despite processing at my peak more than 2 million dollars a year with them which was incredibly frustrating. I moved my processing to Clickbank which has a much more tolerant approach to refunds ( even though they changed their policy this past winter ).

Hope that helps.

I think track record plays more of a role, than refund rate. There has been times over the years when I had emptied my account, but made big purchases with a zero balance, and it never got denied. Of course my bank account is attached to it, but without a track record, those big purchases would have never went through.

Chargebacks are your main concern when dealing with credit cards (whether through PayPal or a merchant account). Visa and MasterCard have strict views on chargebacks. They do not want to see anybody getting more than 1% chargeback rate. This view trickles down to PayPal and merchant account providers. Cross that threshold and you risk losing your account.

A chargeback is when the buyer contacts their bank and says they didn't authorize the charge, their credit card was stolen and used, the vendor did not provide what they paid for, or any other reason that doesn't make you look good. You can read more about them here. Sometimes, consumers abuse the chargeback mechanism. They use it to get stuff for free. Unfortunately, nobody is rushing to put these fraudsters behind bars.