Paypal has announced that users participating in crowd funding initiatives will no longer qualify for payment protection. Included crowd-funding services falling under the new rules are Indigogo and KickStarter. Paypal indicated that these initiatives embody too many "risks and uncertainties".
Beginning June 25th, those supporting crowd-funded projects will no longer be able to submit a claim to recover cash.
SECTION 13.3 Ineligible Items
We’re updating the list of items that are not eligible for Purchase Protection. The new items that will not be eligible are:
- Payments on crowdfunding platforms
- Anything purchased from or an amount paid to a government agency
- Gambling, gaming and/or any other activity with an entry fee and a prize
We’re also clarifying the exclusion for items equivalent to cash to now include stored value items such as gift cards and pre-paid cards.
You can read the full notice of the change to the User Agreement on the PayPal site.