PayPal will No longer Protect Crowdfunding
Well, fellow gamers it seems that the day many of us thought would eventually come has happened. Either Kickstarter was going to get its proverbial shit together and step in to fix its growing issues with unfunded campaigns.. or other agencies would make moves to protect themselves from having to issues refunds and such on failed projects.
PayPal has announced now that they will no very soon no longer issue buyer protection to crowdsourcing campaigns. Ouch! I know many a gamer that as of right now are holding their wallet at the thought that now backing a project has become increasingly riskier.
Here’s PayPal’s full statement regarding the change, via Engadget:
“In Australia, Brazil, Canada, Japan, United States and certain other countries, we have excluded payments made to crowdfunding campaigns from our buyer protection programs. This is consistent with the risks and uncertainties involved in contributing to crowdfunding campaigns, which do not guarantee a return for the investment made in these types of campaigns. We work with our crowdfunding platform partners to encourage fundraisers to communicate the risks involved in investing in their campaign to donors.”
Additionally, “anything purchased from or an amount paid to a government agency” and “gambling, gaming and/or any other activity with an entry fee and a prize” are no longer eligible for Purchase Protection either.
Kickstarter notes that about 9 percent of its projects never deliver, for example — if the failure rate is similar or worse on those crowdfunding sites that take PayPal, that’s a lot of potential refunds. When you look at just Gaming projects Kickstarter raised more than 76 Million dollars last year on successfully funned projects. That is a ton of money left on the table. And as of now Pay Pall is done with having to help pick up the pieces.