Last week, the Contract Worker explored the dark side of accepting credit card payments with PayPal. Although there are various ways to receive payment for services rendered, most clients prefer to submit PayPal payments. This way, they don’t have to worry about postage or cutting checks. Freelancers also prefer this method because it’s quick. The client deposits the payment, and it’s available for immediate withdrawal.

Like most freelancers, the majority of my payments are received through PayPal. Moreover, several clients pay with a credit card. I don’t have a problem with credit card payments, and I don’t mind the transaction fee. However, I have a slight issue with the way PayPal handles a reverse transaction.

It’s my understanding that it only takes one complaint from a disgruntle client for PayPal to reverse a credit card payment. There’s no investigation process. What’s worse…if you’ve already withdrawn the money, PayPal will suspend your account until the money is repaid.

I’ve never had a problem with PayPal, and I probably never will. Still, I can’t help but wonder what would happen if a client submits payment for a project, and then decides to reverse the transaction because they overestimated their budget or simply changed their mind.

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