Charge-backs, PP claims, and fraud

When a Buyer purchases something through the widget, who's the direct recipient of the Buyer's money? FM or the Seller?

That's key to determine what's the side being hit by an eventual charge-back or PP claim.

What happens to the deal in such an event?

Thanks.
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  • Derek (Official Rep) July 05, 2017 19:34
    Hi Alex,

    Thank you for your post.

    When a customer places an order via Fotomoto, we credit your payment account directly via a "split" charge, taking our transaction fee out as one portion and crediting the rest to you. For more about how payments work please see How can I get paid for the products I sell using Fotomoto?.

    In the rare case of a disputed charge, the payment processor (Stripe or PayPal) advises the seller of the disputed charge and it is handled like any other dispute. For more information about how disputes and how to handle them, please see the relevant documentation in either Stripe or PayPal.

    I hope that helps and kind regards,
    Derek
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  • Hi Derek,

    I know how disputes are handled by Paypal, because I've been in the receiving end of fraudulent ones.
    Please explain for example what would happen with such split transactions if a customer buys say a Large (30"x60") metal print for $1239.00 and then files a claim for a refund (or charge-back) with Paypal.

    Thank you.
    Alex
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  • Derek (Official Rep) July 05, 2017 19:55
    Hi Alex,

    First please bear in mind that using Fotomoto is really no different in this case than being a vendor in any other situation. If you provide a service or product, then someone pays you and later disputes your charge, you are always at risk, but the payment processor always gives you the opportunity to respond to the dispute and provide facts that the charge was legitimate. In this case, we can help you to provide proof that the product was ordered, and that the product was delivered as promised. We can provide shipping records and you can also see the order information in your Fotomoto Dashboard.

    In the case you mention, both you and Fotomoto would receive notice that a charge was disputed. If you had made the choice for Fotomoto to produce the prints for you, then we would have charged you for the cost of the making prints as any other print vendor would, and just the same as if you sold a product directly to a customer and they later disputed the charge, you would be at risk of losing the cost of the goods sold, but again this rarely happens, and I'll offer that in my experience, providing the proof that a product was delivered as sold to the customer usually results in the customer losing the dispute and you eventually get your money back though it is a hassle. It's just a risk of doing business that anyone (including us) who run businesses have to deal with.

    I hope that helps and kind regards,
    Derek
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  • Hi Derek,

    That's exactly the point I'm trying to clarify here. In a disputed charge sided with the buyer for whatever reasons factually out of my control (item not received, damaged during transport, etc), am I paying photomoto/bayphoto for all their fees and incurred costs? Am I, the so called "seller", but factually just a provider of digital imagery through your widget in my website, the sole bearer of responsibility for all the costs incurred by the other sides?

    Thank you.
    Alex
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  • Derek (Official Rep) July 05, 2017 20:33
    Hi Alex,

    I'm glad to help clarify, and to be quite clear, when you use Fotomoto to sell products from your website, you are not just the provider of digital imagery...you actually become the seller of photographic prints or any other products that you offer via our service. Your website is your store, you are the seller, and we are a service provider that gives you the tools to sell your work on your website (the shopping cart Widget, etc.). If you use our direct fulfillment services, we are also the provider of print-on-demand services to you the seller.

    If it helps, imagine that you own a physical print shop and customers come in to your store and view your work on a monitor. In this scenario you do not carry an inventory, and when customers come in they pay you for a print. You make it on demand at X print shop, and you then give them the print. This is essentially how it works with Fotomoto except that your website is your store.

    So, just like any other seller of physical products, if someone buys something from you and you deliver the products to them, you are at risk if the customer later decides they want to tell their bank that they want to dispute the charge, even if the charge is legitimate. In the example above, the print shop that made your print would not give you a refund on your print just because your customer decided to not pay you for it, and neither would Fotomoto, but Fotomoto would be there to help you respond to the dispute, providing you with the transaction details for the order, the shipping record, and the information that the customer provided when they placed the order.

    I'm sorry if this has happened to you before. I can certainly sympathize as it has happened to me as well, and it is a total bummer, but as above it happens rarely and thankfully so far it has never been enough of a deterrent to stop me, or the millions of other merchants who sell their products online and otherwise.

    I hope that helps and kind regards,
    Derek
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  • Hi Derek,

    Oh, so it seems like I've feared then. I'm sorry to disagree with you here, but that's a quite convenient way of describing away a serious issue that may become very costly to us, sellers, by the example given above. So costly in fact when compounded that legal departments carefully design liability to put risk away onto the backs of the little guy, as seems the case right here.

    In fact, some other well-established POD's offer a 30-day money back guarantee, no questions asked. Small-time sellers of digital art looking to monetize via POD have to read the fine print very carefully it seems.

    Unfortunately, no one else yet seems to have a so convenient widget for our particular needs, like Fotomoto.

    Thank you.
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  • Derek (Official Rep) July 05, 2017 21:47
    Hi Alex,

    You're more than welcome to disagree with me, and again I'm sorry if you might have been burned by your customers in the past and feel that this is such a large issue that you'd need to promote a mention of another POD service on our Community board.

    I'll go ahead and continue to disagree with you though, as I have managed Fotomoto support for many years now and a) have never heard of a case where a Fotomoto seller was burned by a customer in this way and b) out of many thousands of Fotomoto sellers, you are the only one to have ever posted that you feel this is a big concern. Sure, the risk is always there, and I agree that anyone who accepts credit cards as payment should read the fine print so they familiarize themselves with any potential risks, but in this regard, "Small-time sellers of digital art" are no different than other seller big or small who accepts credit cards. If this becomes too big of a risk for your business, then I might suggest you consider selling offline exclusively, and accept cash only.

    You are always free to use whatever service you like best to sell your work, and we encourage you to choose the best solution for your business needs, whether it be Fotomoto or not.

    Thanks again and kind regards,
    Derek
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