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What if I sell an expensive product, such as a smartphone. It arrives, but then out of the blue the buyer says it is not what they ordered. They return the product and provide proof that they mailed the replacement. All good?

When the merchant receives the replacement, they find that the return box just contains a brick, or something less obvious, such as a broken phone. Now the customer has not paid yet, but they have your merchandise.

How would you be protected in that case?

Currently the seller is protected, because they can defer issuing the refund until after verifying that the returned product is what it should be.

hey bemmu, here's the Payondelivery return process: The buyer has to return the package 'as is' through their Payondelivery account, they print a return label on their Payondelivery account and ship it back to the seller (hence no need to provide proof of return). When the seller receives the package and it's a brick, they raise a dispute with Payondelivery (seller has 24 hours to do this). Because we have shipment data on both the outgoing and return package we can quickly decipher if something else was shipped in the return package to the seller. Once this process is concluded and we determine the seller's original product was not returned, seller gets paid.