Credit card protection vs. PayPal ?
Nov 19, 2017, 2:12 pm
#1
Original Poster
Join Date: Jun 2014
Posts: 213
Credit card protection vs. PayPal ?
Hi,
I was wondering about something:
What's the difference in consumer protection (e.g a dispute) in paying with:
Credit card directly vs. adding the card to PayPal and paying through PayPal.
I know credit cards have some protections, and I'm sure PayPal has some as well. But I'm not sure what happens when you pay though PayPal using a credit card (vs. the same card directly)? Do you get added protections from both?
Any experiences or knowledge on this matter, that you can share please?
Thanks.
I was wondering about something:
What's the difference in consumer protection (e.g a dispute) in paying with:
Credit card directly vs. adding the card to PayPal and paying through PayPal.
I know credit cards have some protections, and I'm sure PayPal has some as well. But I'm not sure what happens when you pay though PayPal using a credit card (vs. the same card directly)? Do you get added protections from both?
Any experiences or knowledge on this matter, that you can share please?
Thanks.
Last edited by kayanco; Nov 19, 2017 at 2:20 pm
Nov 23, 2017, 12:09 am
#2
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PayPal has fewer protections as PayPal complicates things.
As many protections are statutory rather than contractual, card issuers must abide them or face consequences. Because PayPal is not a financial institution, PayPal are not constrained by the protection statutes.
As many protections are statutory rather than contractual, card issuers must abide them or face consequences. Because PayPal is not a financial institution, PayPal are not constrained by the protection statutes.
Nov 23, 2017, 8:34 pm
#4
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Paypal is not a CC and therefore you have none of the legal protections you have with a CC.
Do not ever pay for a service to be rendered in the future with anything other than a CC (no PayPal, no debit cards).
Just ask people holding tickets on AB or at resorts which go bust.
Do not ever pay for a service to be rendered in the future with anything other than a CC (no PayPal, no debit cards).
Just ask people holding tickets on AB or at resorts which go bust.
Nov 23, 2017, 9:30 pm
#5
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There's also no recourse with your CC issuer if you use PayPal. If you attempt to file a chargeback, PP will take adverse action against your account. Or did back in the day, anyway.
Nov 24, 2017, 1:53 am
#6
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For example, I get purchase protection, extended warranties, $0 liability, satisfaction guarantee, and airport concierge on my Empower FCU debit MasterCard, and I get dispute resolution on my Bank of America debit card.
Nov 24, 2017, 4:36 am
#7
Join Date: Apr 2005
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Debit cards have the same basic protections as credit cards depending on the issuer, but Visa/MasterCard generally apply the same protections guidelines to both.
For example, I get purchase protection, extended warranties, $0 liability, satisfaction guarantee, and airport concierge on my Empower FCU debit MasterCard, and I get dispute resolution on my Bank of America debit card.
For example, I get purchase protection, extended warranties, $0 liability, satisfaction guarantee, and airport concierge on my Empower FCU debit MasterCard, and I get dispute resolution on my Bank of America debit card.
On a debit card, IF you report a fraudulent transaction after 2 days, you are liable for the first $500. With a credit card, it is $50. If you wait more than 60 days, you have no protections other than maybe a promise by the financial institution. Meanwhile, you could have checks bouncing all over the place.
There is no way in hell that I would ever carry or use a debit card, especially with the rich rewards that many credit and charge cards offer.
Nov 24, 2017, 9:17 am
#8
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Not exactly.
On a debit card, IF you report a fraudulent transaction after 2 days, you are liable for the first $500. With a credit card, it is $50. If you wait more than 60 days, you have no protections other than maybe a promise by the financial institution. Meanwhile, you could have checks bouncing all over the place.
There is no way in hell that I would ever carry or use a debit card, especially with the rich rewards that many credit and charge cards offer.
On a debit card, IF you report a fraudulent transaction after 2 days, you are liable for the first $500. With a credit card, it is $50. If you wait more than 60 days, you have no protections other than maybe a promise by the financial institution. Meanwhile, you could have checks bouncing all over the place.
There is no way in hell that I would ever carry or use a debit card, especially with the rich rewards that many credit and charge cards offer.
Nov 24, 2017, 12:05 pm
#9
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Visa and MasterCard provide $0 liability on both debit and credit cards. The law says the terms you've explained. Visa and MasterCard can add additional protections to the law above the minimum if they so wish.
Nov 24, 2017, 12:12 pm
#10
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Credit card liability in the US is limited to $50 per federal law. $0 liability is offered by issuing banks (not Visa/MasterCard) for competitive reasons.
Nov 24, 2017, 12:14 pm
#11
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https://www.visa.com/chip/personal/s...-liability.jsp
If the unauthorized transaction involves your debit card or account, Visa's Zero Liability Policy requires issuers to replace any funds taken from your account as the result of an unauthorized debit transaction within 5 business days of notification.
Note: Zero Liability does not apply to the following Mastercard payment cards: commercial cards, or unregistered prepaid cards, such as gift cards.
Nov 24, 2017, 12:42 pm
#12
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The banks follow the general guidelines of Visa/MasterCard. Think about it... Why would Visa/MC advertise $0 liability if the banks could strip it away? Banks likely sign up for $0 liability when they sign a contract with either of those issuers.
https://www.visa.com/chip/personal/s...-liability.jsp
https://www.mastercard.us/en-us/abou...onditions.html
I don't see debit cards there, so $0 liability applies.
https://www.visa.com/chip/personal/s...-liability.jsp
https://www.mastercard.us/en-us/abou...onditions.html
I don't see debit cards there, so $0 liability applies.
Nov 24, 2017, 12:45 pm
#13
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The only time to use debit is if you're looking to get cash back at a grocery store instead of using an ATM, but many banks refund all ATM fees (Schwab, some credit unions) so I can see that practice decreasing in the future.
Nov 24, 2017, 12:57 pm
#14
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Lots of good useful discussion on this thread.
One feature of PayPal is that your actual credit card number is hidden for the merchant. I like this aspect and think it can be useful. BUT, if it's true that PayPal has less protection compared to using the same credit card directly (e.g. charge backs), that would negate the benefit of not sharing the CC info from the merchant.
So I'm surprised that the use of Virtual cards hasn't taken off. To my knowledge only Citi lets your generate a one-time use credit card number. You can even set max spend limit and expiry date.
One feature of PayPal is that your actual credit card number is hidden for the merchant. I like this aspect and think it can be useful. BUT, if it's true that PayPal has less protection compared to using the same credit card directly (e.g. charge backs), that would negate the benefit of not sharing the CC info from the merchant.
So I'm surprised that the use of Virtual cards hasn't taken off. To my knowledge only Citi lets your generate a one-time use credit card number. You can even set max spend limit and expiry date.
Nov 24, 2017, 1:04 pm
#15
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Correct, but we're not talking about the debit networks here. Banks also encourage the use of payments over "credit" on a debit card, so zero liability applies unless the cardholder makes a mistake and chooses debit.
The only time to use debit is if you're looking to get cash back at a grocery store instead of using an ATM, but many banks refund all ATM fees (Schwab, some credit unions) so I can see that practice decreasing in the future.
The only time to use debit is if you're looking to get cash back at a grocery store instead of using an ATM, but many banks refund all ATM fees (Schwab, some credit unions) so I can see that practice decreasing in the future.