A reseller boss has warned fellow channel firms to beware when using PayPal to buy IT equipment after getting his fingers burned in a recent transaction.
Dennis Armstrong, managing director of Computer Communications Limited (CCL) is currently embroiled in a row with the e-commerce giant after he used the service to buy a Cisco switch from a new supplier.
The Leeds startup - which Armstrong wishes to keep anonymous due to the fact the case is ongoing - accepted half of the payment from CCL up front as a deposit and agreed to receive the balance once Armstrong had received and inspected the kit.
On receipt of the equipment, Armstrong discovered that the main component of the switch was not as it was described when it was ordered. After the startup refused to refund him and requested the final instalment, he asked PayPal to halt the first payment to the supplier, but the payment giant refused and sent it anyway.
Armstrong claims the firm told him that he was not protected as a buyer if he did not complete a full transaction.
"They told me ‘hard luck'," he said. "PayPal have paid them the money. I'm stuffed - they told me that in the terms and conditions, it says if you pay in part then that that's their wriggle-out room. I don't think many other people would know that.
"I would say don't use PayPal at all unless you know the clauses inside out."
Armstrong said that the only reason he began using PayPal in the first place was because he thought he would be protected as a buyer.
"I've had situations before where I've bought a load of kit but only paid 10 per cent [up front]," he said. "But I've never used PayPal before - I wanted to use them because I thought I was secure. But it turns out I'm not."
In a statement sent to CRN, a PayPal spokesperson said:
"PayPal's Buyer Protection covers purchases where the buyer has paid the full amount on PayPal. Unfortunately in Mr Armstrong's case, he only paid a deposit so we were unable to offer him a refund."
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