PayPal turns a cold shoulder to backers of failed crowdfunding campaigns
With great products like the Pebble getting their start on crowdfunding sites, there’s certainly a lot of demand from consumers to get in on the ground floor and help new companies deliver exciting new gadgets. The problem is that Pebble’s success is the exception, not the rule. While there are a lot of Kickstarter and Indiegogo campaigns that do deliver on their promises, many of them never make it to production, leaving their backers in the lurch.
Up until now, PayPal has offered buyer protection for purchases made on crowdfunding sites, but the company has just released a policy update which will no longer guarantee a refund to its customers if a crowdfunded project goes belly up. The policy update also cuts out “government agencies” and “gambling sites” from its refund protection guarantee, so don’t even bother contacting PayPal if you want a refund on your taxes.
Do you think PayPal’s new attitude towards crowdfunding sites will have a negative impact on new companies hoping to get their start with Kickstarter and Indiegogo campaigns?