Etsy considers a post to be "lost" if a buyer opens a case and the earliest estimated delivery date has past. Delivery services always struggle to meet their deadlines over the Christmas period and the strikes have made the issue far worst especially with international deliveries. If you have been watching the forums of late, until very recently there were dozens of sellers complaining about the refunds that Etsy were seemingly automatically giving out for late deliveries. Many were charged to the seller rather than the SPP but again, seemingly, a lot of these appeared to be for goods that should not have been sold on Etsy or due to no or non compliant refund policies. Yes a lot of people will have had refunds and then the item arrives so they'll have got free stuff. Because Etsy has refunded it is now theirs rather than yours to give away and they do not want it back.
You are correct to think Royal Mail themselves state 25 days, (although I thought it was 21 days), but that is the time before you can make a claim against RM yourself. The work arounds are to either to extend your despatch time hence giving a later delivery date by RM or change the courier to other and set your own delivery date which can be up to 30 days. I choose the former but I think most opted for the later adaptation. It is quite probable that the "BOTS" are still giving out automatic refunds due to the high level of cases for late delivery although hopefully now that the Christmas rush is over and no further actions by RM planned, at least at present, that should ease soon
