Comments on: PayPal Reserves explained

By: permacrisis

permacrisis — Sun, 05 Jul 2009 20:51:37 +0000

Now just think. If the banking industry (you know- the REAL banks) are getting in trouble for 5 and 7 day holds ( http://www.walletpop.com/top5/sneaky-overdraft-traps-5 ) then just think what would happen if these practices emerged out into the light.

By: Candy

Candy — Thu, 02 Jul 2009 18:08:18 +0000

@Michael – you mean this is happening to your website and NOT to listings on Ebay? This worries me since I use Paypal exclusively on my website. This is something I did NOT want to hear! :-(

By: Michael

Michael — Wed, 01 Jul 2009 20:18:17 +0000

Up until this week we have been relatively happy with PayPal Payment Pro.(With the exception of their non transparent chargeback processes), due to their low discount rates that reward you for the amount of business that you do. We will occasionally (2 times in ’09) get a “Fraud/Unauthorized” chargeback, but the ratio to positive business is <.01%. Although, just like any merchant, we hate chargeback’s, the amount has been thankfully, very low compared to the total of quality business that we do.
PayPal has now requested that starting 7/28/09, we are required to have a 20%, 60 Day Reserve, which would come out to approximately $40,000+ in “Reserve” for “reversals and chargebacks”.! They state that we “have not done anything wrong”. “By requiring some merchants to reserve money in their accounts, we’re able to lower our own costs. This helps us to continue providing competitive pricing for all sellers who use PayPal.” We sure are not being rewarded for the “Clean” business that we do!
PayPal did say however, that the “Reserve” would be held in our/their HIGH YIELD, .76%, Money Market account! Thank-You, Thank-You, Thank-You!
Their stated criteria for the New Reserve Requirements are:
“We looked at:
•How long you’ve had your PayPal account.
•The type of merchandise you sell.
•Customer service:
•How satisfied are your customers?
•How often do your customers file complaints?
•How quickly do you deliver merchandise?”
These sound like Ebay requirements. We Do Not Sell On Ebay, but strictly through our etail website. We are an A Rated, ACCREDITED, BBB COMPANY, since 2003! PayPal has been kind enough to notify us that they will evaluate our “Reserve” in 6 months. Our yearly $1,000,000.00+ of clean business, with PayPal Payments Pro, has no bearing on their decision.

The reason for this post is 1) Exasperation with an entity that does not seem to care about our business and 2) If it can happen to us it can happen to anyone!

Needless to say, we are evaluating alternative Merchant Accounts that will appreciate the quality business relationship that we have to offer.

Caveat Venditor!

By: Candy

Candy — Tue, 30 Jun 2009 16:55:23 +0000

Is this just another ploy to gather interest money from the “float”? If so, I’ll be selling elsewhere using another payment service. I know Ebay must be aware that with each of these policies they lose even more sellers. If not, they really should be getting concerned. The five “free” listings each month certainly are no incentive to get us back again. In fact it only made me list the five freebees then go elsewhere because I find traffic in my category almost non-existent! I sure would love to be a fly on the wall up in San Jose and listen to the real thinking behind some of the ditziest (is that a word?) policies I have ever seen!

By: Jason Fishman

Jason Fishman — Sat, 27 Jun 2009 17:10:06 +0000

My past experiences with paypal have been negative. As a seller and customer of paypal for 10 years, I am basically treated like a piece of trash. I always do the right thing by ebay and my buyers although paypal does not take the whole equation into consideration. Paypal needs to become more customer oriented and realize that without the customer, they would be nowhere.

By: Tamara Martinez-Anderson

Tamara Martinez-Anderson — Wed, 24 Jun 2009 23:36:20 +0000

My experiences with PayPal have been decent – -however, as a very small business, we will be searching for another means to manage our transactions as a result of the new “reserve” policy.

By: Frank Powell

Frank Powell — Fri, 19 Jun 2009 00:37:56 +0000

Due to the extrodinarily high reserve required by PayPal I am forced to seek out another vendor. PayPal is currently requiring a reserve of 10% of my annual sales which makes the reserve amount $300,000.00. The maximum refunds I have given have been under $3000. I think $30,000 is reasonable but nobody can expect to hold 10% of a small businesses revenue in excess of $300k. This is rediculous. In addition, it wasn’t until six months after I spent all the time to set up the account that PayPal sprung this reserve thing on me. Very irritating that I spent the time and effort in setting up the account to have them do this to me. Now I am forced to seek out another provider. While I get the reserve, I don’t understand how they came up with the amount. The representative who spoke to me about it was unsympathetic and matter of fact. She did not want to even hear what I had to say or inform me of how to protest the threshold. Dealing with PayPal this past year has been a difficult experience.

By: Candy

Candy — Tue, 09 Jun 2009 20:49:04 +0000

Wow! I’m afraid some of these threads are definitely depressing me. :-( I think Ebay/Paypal best put some of these policies aside before they lose ALL their traffic!

By: permacrisis

permacrisis — Tue, 09 Jun 2009 19:39:06 +0000

Now hang on a sec, where does Bill Me Later fit into all this. How come we never hear about them anymore?

How can one become a BillMeLater only seller. They can’t, can they.

By: Marc

Marc — Tue, 09 Jun 2009 17:56:25 +0000

Bottom line:

Paypal can’t be trusted