The "Pay After Delivery" program enables shoppers to pay for purchases two weeks after clicking ‘buy’. The funds are not taken from that available in the customers PayPal account, rather they taken from the buyer's bank account on file.
"We're always looking for ways to give you extra peace of mind and make you feel more secure when you shop online. That's why you can now choose Pay After Delivery at checkout,” PayPal stated in a letter to select UK members, reports ecommercebytes. "With Pay After Delivery purchases, we'll pay the seller straight away but will only request the money from your bank account 14 days later. This gives you the time to receive the item before you pay. If the item doesn't arrive or isn't what you expected, you're covered by PayPal Buyer Protection.”
The program has been criticized by sellers, as they feel it endorses a "try before you buy" attitude. They are afraid that it will lead to an increase in returns.
A UK reader who received an email promoting the Pay After Delivery service told ecommercebytes, "Looks a bit suspect to me - what benefit is this as there is always the guarantee? Makes a simply method of payment more complicated than it need be and will lead to more returns as buyers regret buying (buyer remorse)."
Buyers also have concerns about the program.
A U.S. reader recently reported PayPal had opted him into the program without his permission. "I just accepted a second chance offer on eBay and after I accepted the offer and made payment I got a payment confirmation email from PayPal that said I had selected to PAY ON DELIVERY and the funds wouldn't be taken out of my account for two weeks. I can't find any way to opt out of the delayed payment, it just seems to be forced on you now."
Buyer Protection Scheme:
PayPal recently announced new terms to their Buyer Protection scheme that will take effect from 17th June this year. Buyer protection will be extended to cover services, digital goods, travel tickets and other intangible items.
PayPal is also extending the time for buyers to open a dispute from 45 to 180 days, from the that date. This brings it inline with similar protections offered by credit card companies. The extended buyer protection applies to people who use a UK PayPal account to make a purchase from a UK or overseas seller on and off-eBay.
“From 17 June 2014 PayPal will reimburse UK buyers if they do not receive these items or services or if the goods or services provided do not match the seller’s description,” said PayPal’s statement.
“PayPal is delighted to give people in the UK even greater reassurance when they’re buying goods and services. These changes follow feedback from customers who have asked us to extend buyer protection to cover services and items such as travel tickets and digital goods,” said PayPal UK’s, Cameron McLean. “They underline PayPal’s reputation as the faster, safer way to pay online, on smartphones and in-store.”