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Paypal Not The Way To Go

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  • Paypal Not The Way To Go

    As with most, I thought Paypal was going to be simple low cost way of collecting money through my webpage. And at first it was. Once your volume get up there, Paypal will one day just freeze your account for no valid reason not allowing you to remove any funds, then once you scream for days to get an answer with them as to why, they will remove the freeze “temporary hold” and a put you on a "rolling reserve" for no valid reason. This happened to me. The reason they gave me was that my volume was increasing. Not ever a chargeback, 100% customer satisfaction, PowerSeller on the eBay side (eBay owns PayPal), thousands of perfect transactions. I have used actual :mad: merchant accounts for 20 years without ever an issue like this. The Rolling Reserve they arbitrary Decided on me was to Hold 20% of everything that goes through for 90 days. I don't know about you, but don't you need that money to operate your business. Think it won't happen to you...I did...until they screwed me. Think again... Google "PayPal rolling reserve" you will see thousands of complaints. There are several class action lawsuits forming. I have filed a complaint with my States Attorney General. They offer false protection for the buyer and seller…no matter who you are you will get a run around with PayPal. A credit card merchant account is way better to go, but PayPal’s massive marketing and near monopoly with eBay makes it difficult I know. Resist the urge to go with PayPal, it is NOT WORTH IT, you too will ultimately get screwed. I know I am not alone…. Please share your PayPal horror stories so that others are not faced with the same issue.

  • #2
    I have been using my own merchant account as well as accept paypal payments. In my best year I did $800,000 through paypal and I have never had any freeze or any holds. What volume are you doing? Are you a legal business with business EIN on file with them?

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    • #3
      Originally posted by tmilone103 View Post
      I have been using my own merchant account as well as accept paypal payments. In my best year I did $800,000 through paypal and I have never had any freeze or any holds. What volume are you doing? Are you a legal business with business EIN on file with them?
      I've done over $100K/month with Paypal. This was the first I ever had a freeze as well after 8 years with them. I am a legal business with all Tax ID's verified bank info., etc with them...perfect record. Now I am on a perpetual 20% rolling reserve (That's $60,000 of perpetual cash that I can never have or take out of my account if I average $100K/mo in sales). Why should they hold $60K or even one cent of my money when I've never had one issue? There is no way any company should risk using Paypal. Just wait they'll get you too unless we stand up to them. I've only heard about this issue and never thought it would never happen to me. The more I researched it the more horrer stories I found. This has been going on since about 2009, with ever increasing frequency it is happening to just about any Paypal account.

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      • #4
        Something must have triggered it, With that volume you should have a personal account rep. Did you contact them and find out what the trigger was. It could be an item that you sell, Large amounts of charge-backs that you don't hear about, etc.

        Paypal has been great for us. Their seller protection beats the support I get from my merchant account hands down. If an item is delivered to the confirmed address and signed for we are always protected. We don't even get informed when this happens and they just take care of it.

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        • #5
          This site has been around for years and years, and has been documenting how Paypal freezes the bank accounts that are tied to their PayPal accounts. Yes, they freeze the BANK ACCOUNTS, not just the PayPal accounts. If nothing else, it's an education in the ways of PayPal: PayPal Alternative - Pay Pal Lawsuits, PayPal Complaints & Fraud

          That's not to say I don't use PayPal as an alternative payment solution for my customers (along with my regular merchant account for credit cards), but if the volume gets high, I'll be turning it off rather than taking a chance that anything like these horror stories end up happening.

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          • #6
            Save yourself future issues - Stay away from Paypal

            I encourage anyone to do some research if they plan to use a Paypal account or have an exsisting account with them. Below is a link to one of the current class action lawsuits against PayPal and a very small selection of comments from other sellers who were snookered by them. Paypal used to be a good way to go, but times have changed. If you are happy with PayPal like I "was", you are ignorant to what they can and will do to you for no valid reason. If I can save one of you from from the frustration I went through, I will consider it a victory.

            One of several pending Class Action lawsuits pending against PayPal:
            PayPal Holding Money | Freed & Weiss LLC | Chicago Illinois

            PayPal’s practice of placing holds on users’ accounts has met widespread
            disappointment and anger from consumers around the country, as evidenced by the numerous websites created to protest PayPal’s holding of funds. See, e.g., Join the 2010 Active Class Action Lawsuit against PayPal for Holding YOUR money!, PayPal Alternative - Pay Pal Lawsuits, PayPal Complaints & Fraud, PayPal Problems & PayPal Answers!, PayPal - Horror Stories, Lawsuits, PayPal Problems & Information - PayPal Account, Paypal Problems, Information, Issues, Class Action Lawsuits - PayPal. Typical comments on these websites include:
             “I'm from Northern California. They're holding around $18,000 of mine hostage for 180 days as of a few days ago. ….. I've uploaded every document under the sun and after jumping through their hoops they decided to keep my money anyways. I'm an honest seller with 100% positive feedback and ZERO charge backs….” Taken from Join the 2010 Active Class Action Lawsuit against PayPal for Holding YOUR money!.
             “PayPal keeps holding funds on my account even though i have 100% feedback rating. They can't give me a reason, they just say it's policy….” Taken from ConsumerAffairs.com: Knowledge is Power! Consumer news, reviews, complaints, resources, safety recalls.
             “I've been using paypal as my transactions processor for 3 years or so, and have been pretty active the entire time, since I sell a lot of stuff on multiple sites. … I wake up Friday morning (January 29, 2010), planning to transfer the funds to my bank account, since all sales for the month had been completed... Low and behold, my Paypal account is frozen. …Needless to say, it's now a paypal horror story on the tune of $2,455.63. It took them 1 whole day to say they will hold my money for 180 days....” Taken from PayPal Alternative - Pay Pal Lawsuits, PayPal Complaints & Fraud.
             “For no reason these [expletive] have decided to freeze all funds in my account for 180 days for no reason whatsoever…their excuse “report of suspicious activity”. Taken from PayPal - Horror Stories, Lawsuits, PayPal Problems & Information - PayPal Account.
             “i have a paypal premier account and a paypal business account, on february 12th my business paypal account was limited because of high risk security concerns, 9 days after my paypal premier accounts has been limited because of the same…my business account remained frozen with over $2,400dollars and the premier account was frozen with $597.00 dollars for 180 days…” Taken from ConsumerAffairs.com: Knowledge is Power! Consumer news, reviews, complaints, resources, safety recalls.
             “Holding auction funds to me from a buyer for (up to) 21 days.” Taken from ConsumerAffairs.com: Knowledge is Power! Consumer news, reviews, complaints, resources, safety recalls.
             “For over 60 days now. Paypal has $9,752.59 USD of my money!” Taken from PayPal - Horror Stories, Lawsuits, PayPal Problems & Information - PayPal Account.

            Other places to check PayPals own forums (which are monitored and edited from Paypal) Search: Limits On Accounts, Rolling Reserve

            Comment


            • #7
              Ty

              Appreciate the info on the class action suit. I just submitted my info to the firm. Know exactly how the others feel.

              PayPal is NOT governed by most states and certainly not any federal branch. The only way we got our money freed was because I went to high school with the wife of one of our
              GA representatives. He went to bat for me with the Attorney General's office of GA. One letter from them hinting at legislation in GA to regulate PayPal and LO my funds became available.

              BEWARE OF PAYPAL IS MY BEST ADVISE.

              Comment


              • #8
                PayPal did not start doing that until they were purchased by eBay. eBay instituted it because of all the people that were getting ripped off by eBay sellers collecting money and never sending the merchandise.

                eBay pushed everyone to PayPal as the payment processor period. They then got everyone on the front side (eBay listing), middle (final value fees) and then on the end for payment fees through PayPal. They created a captive market and then tauted the payment hold on the seller as a buyer protection on the auction site.

                They did not care if you ever sold on eBay or ever planned on doing it. They instituted the policy because of idiots and just rammed it down everybody's throat.

                I don't use eBay or PayPal and never will again. eBay does what it wants and expects everyone to take it.
                David
                David's Gifts and Things

                Wholesale Gifts, Home Decorating, Jewelry and More

                Quality, Selection, Value Always

                The more you buy the more you save!

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                • #9
                  Some thing happened to our paypal account with ebay. We have 500 feedbacks, with 0 negatives and 1 neutral. We have NEVER had a customer dispute anything or open a case against us, if something happens we always give a refund immediately to avoid problems. The ebay account is 10 years old and the paypal account is 3 years old.

                  A month ago they started holding funds. I called them and went off on the person on the phone. She told me it was because two months ago we had an increase in sales. Told them so because we bought some new inventory and had more items for sales we are being punished??? I told her, you know my bank and credit card processing reward me when I have increased sales by having a lower percentage charged. I have never heard of being punished for doing good. So I asked well, how am I supposed to pay my suppliers if your holding the money. Obviously she beat around the bush and had no answers.

                  The hold was finally removed this month. It killed me to see my money being held, especially by a company I hate. If it wasn't that we have such a high amount of sales on ebay, I would tell ebay and paypal to go fly a kite.

                  It would be a dream of mine to build a competitor to ebay and paypal. I just hate companies that take advantage of everyone because they now you don't have many options, and will keep using them.
                  Last edited by Kanoa9321; 08-23-2011, 11:31 PM.

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                  • #10
                    eBay has gotten way to swelled headed for the world. When they made the buyer always right and the seller always wrong with no recourse against the dimwit purchaser that complains about everything and threatens the seller with feedback they lost me and a lot of other sellers.

                    They took what had worked and changed it to kiss the a.. of the minority of buyers that hurt the sellers the most to try and keep their profit margin up. They could always use the lowered feedback to cut whatever discount the sellers got so they always win.

                    Their next goal was/is to destroy ProStores by having meaningless foreign technical support that no one understands and to raise prices by 50 - 90%. Not to mention simply useless upgrades that all but the complete novice have no use for.

                    I personally hope they get baked in any lawsuit they get drug into. I'm glad to I moved the store here and have no ties to them whatsoever.
                    David
                    David's Gifts and Things

                    Wholesale Gifts, Home Decorating, Jewelry and More

                    Quality, Selection, Value Always

                    The more you buy the more you save!

                    Comment

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