So i get an e-mail from PayPal saying: “Following a risk assessment of your account we feel it is necessary to reserve $25,000.00 of your funds”
Basically PayPal gets to hold onto $25K in my account (Interest free) that i have no access to. If i were to close my account, they hold onto it for a period of 180 days.
I have been doing a no-questions asked refund policy and PayPal feels we are at risk and would require having a reserve fund to support a mass of refunds if need be. I understand this, $5K is understandable…but $25K is absurd.
I have done over 15,000 paypal transactions in the past 4 months and the average transaction is $50. I have done less then 1% in refunds, yet PayPal feels that it is necessary to hold onto 3x’s the amount that I have refunded as a reserve. B.S.
At a drop of the hat they can just say… “well, we’re going to hold onto $XX of your money…because we want to”
/rant. I dispise the Monopoly known as eBay/PayPal.
i asked them to share with me their “risk calculator” and how that value is chosen. They say they cannot disclose that information. I told them that’s like getting pulled over and given a ticket, but not being told why…just pay the fine. How do you address the problem if you don’t know what it is?
that is hardly the “world” that is the “we’ve got you by the balls PayPal/eBay” business.
why not just change your refund policy, but still take it as no questions asked?? something similar happened to me and all i did was change stuff around and it all went back to normal
It’s all about how many refunds you’re making relative to how much you’re bringing in. If they see that you’re sending back tons of payments, they look at it as a sign things might not be so good for you.
You might want to ask them what % of refunds vs. income triggers an assessment.
the policy is not addressed to PayPal. The no-hassel policy benefits PayPal because they don’t have to deal with disputes. We are averaging about $8K/day in sales… so refunding somebody $50 isn’t much of a risk in my eyes.
that’s what it has pushed me to… PayPal has been established as a convienence. Ebay only makes it that more lucritive for PayPal to be the only option to pay for auctions.
Glad to hear. It really is awful what paypal does to small businesses, but if enough people get fed-up and find alternatives policy may change. Or ebay will just force more payment restrictions into their auctions…
Edit: I thought there is a way to redirect a buy-it-now payment away from paypal to your own payment system. Maybe I’m mistaken. Is paypal the only option when paying for an ebay auction?
I think there has to be more that PP could do for you … call and try to sppek with someone “higher” up … ask if they can give you some type of interest or you will be moving your 8K a day to something else … I think you are to “big” for PP and need to get accounts with the CC companys
Lol…in my head that made sense but reading it now I guess it didnt.
What I meant to say was that I use it for my online web hosting and software sales and keep a lot in it since the interest is better. I have gotten emails that they have held the amount of almost a past months of transactions from me. I only make about 100 transactions a year and the ave one is far less than what the OP was but it just is a shit policy of PP since they honor refunds of users.
A curious question, if you have a bank account and credit card on your account and someone sends you say $1,000 for an item. If you widthdraw it right away to your bank account and 30 days alter the guy complains and says he never got it, does PayPal have the right to go into your account and take the money out?
No. All they can do is freeze your paypal account and bitch at you. Then they send it to collections and they nag you for months, but since they don’t have your social security # they can’t do shit.
