Security & Fraud

Etsy Payment Error Hits Sellers

etsy-revenue-growth

Etsy suffered a bill payment error in which a large amount of money was withdrawn from several of its sellers' bank accounts and charged to their credit cards late last week.

According to a report, although Etsy said the issue has been corrected and that it was not due to fraud, sellers have to deal with a delay in getting their money back given that it is a federal holiday (Feb. 18).

Complaints about the problem started emerging in Etsy's community forums and on Twitter on Friday (Feb. 15), when the sellers started seeing amounts from hundreds to tens of thousands of dollars that were taken out of or charged to their accounts. In its forum, an Etsy representative reportedly posted a statement saying the company was “aware of a bill payment error affecting a small group of sellers which resulted in some cards being incorrectly charged.” On Sunday (Feb. 17), Etsy provided a longer explanation to sellers, saying it has already issued a refund to the incorrectly charged cards and that it will send deposits to bank accounts on Tuesday (Feb. 19), noted the report.

In the statement, Etsy warned that it could take several business days for the refunded amounts to clear and settle in the card accounts. "For affected sellers, we are very sorry for the trouble or concern this may have caused,” wrote the company. “Our first priority has been to correct the issue. This was not a fraud issue, but instead, an error related to a site change which affects a small group of sellers and is unrelated to buyers’ purchases.

“This is an issue we do not take lightly,” the statement continued. “We’ve assembled a payments task force, including senior executives across Etsy, to address any concerns or troubles resulting from this error. We will refund any undue fees associated with this incorrect charge and change in deposit schedule. We don’t expect this error to impact additional sellers going forward."

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The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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