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dbe36e0c
Community Member

chargebacks

Hi its been my third contract and am getting third notification of chargeback may I ask that upwork team shows client payment method verified and can I say that upwork is not safe anymore for freelancers to work because we can't take burdern of chargebacks from every second client kindly help out

16 REPLIES 16
PradeepH
Moderator
Moderator

Hi Mehtab,

 

Thank you for your message. I am sorry to hear about the chargeback. I see that you are already communicating with the team handling your account. Please don't hesitate to follow up with them on the same support ticket if you have additional questions regarding your concern. 

 

Thank you,

Pradeep

Upwork
wlyonsatl
Community Member

I wish Upwork management would explain why it isn't forcing, or even allowing, clients to make payments via Zelle or similar payments services rather than credit cards, which would reduce the likelihood of chargebacks.

 

For the three months ended June 30, 2022 74% of Upwork's revenue came from US clients, most of whom could easily use these common US payment methods. And the US government says it will introduce an even cheaper option for retail bank-to-bank money transfers in 2023, so it's about time that Upwork find a more secure way to get paid so both it and freelancers lose less money to payment-related client fraud.

 

Upwork could even make the use of these more reliable payment methods optional and mark each new project with the type of payment method the client is using. Freelancers can then decide whether they want to submit a proposal to work on that project. I imagine some projects would receive more proposals than others (and maybe even lower freelancer pricing) based on this information, but both freelancers and Upwork would make more money overall. And freelancers who currently avoid fixed price projects would be more likely to accept work under fixed price contracts, which at least some clients would appreciate.

Not sure any client in her right mind would use Zelle to pay for freelance services, since it's impossible to reverse a payment. Zelle's own website advises against using it to pay people you don't know:

 

Zelle® is a great way to send money to friends, family or others you trust such as your personal trainer, babysitter, or a neighbor. If you don’t know the person, or aren’t sure you will get what you paid for (for example, items bought from an on-line bidding or sales site), we recommend you do not use Zelle® for these types of transactions, which are potentially high risk.

Zelle® does not offer a protection program for any authorized payments made with Zelle® - for example, if you make a purchase using Zelle®, but you do not receive the item or the item is not as described or as you expected. 

 

 


Phyllis G wrote:

Not sure any client in her right mind would use Zelle to pay for freelance services, since it's impossible to reverse a payment. Zelle's own website advises against using it to pay people you don't know:

 

Zelle® is a great way to send money to friends, family or others you trust such as your personal trainer, babysitter, or a neighbor. If you don’t know the person, or aren’t sure you will get what you paid for (for example, items bought from an on-line bidding or sales site), we recommend you do not use Zelle® for these types of transactions, which are potentially high risk.

Zelle® does not offer a protection program for any authorized payments made with Zelle® - for example, if you make a purchase using Zelle®, but you do not receive the item or the item is not as described or as you expected. 

 

 


To add to what Phyllis is said, I had a client attempt to pay via Zelle but I never received her transfer. So from my perspective she has not paid, but her account was debited funds. I have actually had to take legal action now to get her to pay because she is dragging her feet to actually contact her bank and find out where the money went. 

Zelle is awesome.

To those of you who clearly do not understand my post, let me clarify that the solution I propose is meant to solve the problem of clients' payments TO Upwork being reversed due to some element of fraud by the client. (It is a violation of Upwork's Terms of Service for a client to pay a freelancer directly, right? That need not change.)

 

If clients continue to pay Upwork but using less reversible payment methods, then Upwork will less frequently need to reverse payments it makes to freelancers for work they have performed.

 

If anyone here thinks a client takes on higher risk of non-receipt of contracted work because they use a different method to pay Upwork, please do explain why that would be the case. Thanks in advance for your insights.


Will L wrote:

If anyone here thinks a client takes on higher risk of non-receipt of contracted work because they use a different method to pay Upwork, please do explain why that would be the case. Thanks in advance for your insights.


You don't think this is obvious? Of course clients take on a higher risk when you remove ways that they can dispute payment. Why don't YOU explain why you don't think it's a higher risk? 

Amanda,

 

How would what I propose prevent a client from disputing in the same way they dispute now? Clients just couldn't unilaterally reverse payment and leave Upwork holding the bag on hourly projects and both the freelancer and Upwork losing income on fixed price projects. But that doesn't mean Upwork couldn't reverse payment to a client, if Upwork, in its wisdom, decided a refund was in order.

 

Right now, Upwork doesn't fully control the refund process. I don't think that's a good thing. Do you?


Will L wrote:

Amanda,

 

How would what I propose prevent a client from disputing in the same way they dispute now? Clients just couldn't unilaterally reverse payment and leave Upwork holding the bag on hourly projects and both the freelancer and Upwork losing income on fixed price projects. But that doesn't mean Upwork couldn't reverse payment to a client, if Upwork, in its wisdom, decided a refund was in order.

 

Right now, Upwork doesn't fully control the refund process. I don't think that's a good thing. Do you?


That isn't what you asked or what I asked. I asked how you think it doesn't increase risk to clients. Fewer routes that clients can take to dispute projects does increase their risk. I'm not saying I agree with chargebacks, but when I shop online I only use a credit card and never my bank account for the specific purpose that my credit card has 100% fraud protection and my bank account will just go: "Sorry, too bad."  

 

Clients should be willing to go through the dispute process, but we all know that Upwork takes days and weeks to deal with things. That can be frustrating. 


As far as chargebacks, most of what I see reported as chargebacks in the forum are obvious scams and fraud in which it appears, at times, that the freelancer is possibly complicit in the fraud, especially considering that no work is done and that the TOS are broken by both parties. I have seen very few cases of actual chargebacks where the dispute process had failed entirely. 

 

How many chargebacks (not failed payments) have you had, Will? 

Amanda,

 

How do you think the dispute process would change if Upwork received payments for escrowed amounts from clients through a different, non-reversible payment method?

 

What I propose only reduces the possibility of clients fraudently using chargebacks to avoid paying freelancers' for their work. It would force clients to go through the Upwork dispute process, which certain types of clients can currently avoid completely by using a chargeback.

I absolutely agree.

Keep the escrow funding as a cleared point of sale vs putting a hold on funds.  Alternatively, they could offer a guarantee similar to the hourly time tracker by using the time tracker to capture job activity.

I have a hard time understanding why this is such a challenge to do with the technology available....

This is what I don't understand.  If the funds are already in escrow, why arent they being released directly from escrow to freelancer, and any remaining funds returned to the client's account?

jeremiahbrown_0-1662215262670.png

 

Jeremiah,

 

I think what that list is showing is the accounting treatment of fixed price payments.

 

When the client sends money to Upwork, it shows on your account as being in escrow but this only means Upwork's in-house escrow agency is safeguarding the funds in a big pot that all freelancers' escrows are held in. They are not really added to any sort of separate "escrow" for your particular account, though they do show as "escrow" in Upwork's reporting to you.. Upwork's own escrow agency transfers the correct amount from its own account to yours when you successfully submit work for payment.

 

The particulars of this process have nothing to do with whether or when you get paid. Requests for refunds or chargebacks by clients interfere with the final transfer of your funds from Upwork's escrow and your account. If there is a chargeback. the funds are removed from the escrow agency's account or reversed out of yours, depending on when Upwork is notified of the chargeback.

 

 


Will L wrote:

To those of you who clearly do not understand my post, let me clarify that the solution I propose is meant to solve the problem of clients' payments TO Upwork being reversed due to some element of fraud by the client. (It is a violation of Upwork's Terms of Service for a client to pay a freelancer directly, right? That need not change.)

 

If clients continue to pay Upwork but using less reversible payment methods, then Upwork will less frequently need to reverse payments it makes to freelancers for work they have performed.

 

If anyone here thinks a client takes on higher risk of non-receipt of contracted work because they use a different method to pay Upwork, please do explain why that would be the case. Thanks in advance for your insights.


Just to be sure I understand you correctly: Are you advocating for UW to require clients to use non-reversible payment methods? If not, then what might possibly incentivize a client to do so? 

eeb179a1
Community Member

same thing happened to me, it's just not safe anymore and theyre doing nothing to improve the payment security. the best solution they gave me is confisticating my money or my account will be frozen, so funny how they oppressed me with their words. 

wlyonsatl
Community Member

Ah, Amanda, I see now. You think it's a good thing that clients continue to have the option to use a chargeback to dispute paying a freelancer because the Upwork dispute process takes so long and it can be frustrating.

 

That's an interesting take, but I'd rather see Upwork stay in full control of the dispute process, unless the dispute moves on to arbitration.

 

 

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