PayPal to drop Purchase Protection for crowdfunding payments

Consumers who back crowdfunding campaigns on platforms such as Indiegogo will no longer have the support of PayPal should things go awry.

Previously, PayPal would allow those who paid for projects through its online payment service to request a refund if products failed to materialise.

It should be noted that although this applies to sites such as Indiegogo, backers paying through Kickstarter are already stopped from registering chargebacks, with neither Kickstarter nor PayPal taking responsibility for campaigns that fall apart.

The updated policy terms kick in at the end of June, and could affect the way backers look at potentially risky investments on crowdfunding platforms.

Kickstarter previously revealed that around one in ten video game campaigns fail to deliver on their promises, and multiple high-profile campaigns worth millions of dollars have imploded, resulting in complaints from thousands of supporters, many of whom are ultimately left out of pocket.

Thanks, The Verge.