Paypal send me this lovely letter.

[TylerH860]

I have never had any claims, charge-backs, or payment reversals issues on the buying or selling side ever. I have 100% feedback on ebay and send everything out quickly.

This is a letter I received from paypal today, stating they want to hold my money for 21 days after receiving payment. This is 1 day after I transferred $500 to my checking account. I guess that ticked them off. I week ago I sold an item totaling $100. There is still $190.00 in the account since I can only transfer $500 a month a don't dare give them any more of my information to raise that limit. "They didn't make the decision lightly"... what a crock. Why would you choose to do this right after I yank $500 out that you're making interest on?


Hello,

We're writing to let you know about a change to your PayPal account.
Starting 12/8/2011, money from payments you receive will be placed in a pending balance for up to 21 days. By doing this, we're making sure that there's enough money in your account to cover potential refunds or claims.
Even though you can't access the money right away, please ship orders quickly and communicate with your customers. After 21 days, you can withdraw money from each payment as long as the customer hasn't filed a dispute, chargeback, claim, return, or reversal.
The money may be available sooner if:

1. We can confirm that the item was delivered.
2. Your buyer leaves positive feedback. (Applies only to eBay items)

This change isn't necessarily permanent. We'll review your account every 35 days and re-evaluate if we should continue to hold your payments. If we decide to stop holding payments, we'll email you to let you know.
Why are my payments being held?
We reviewed your account and determined that there's a relatively higher than average risk of future transaction issues (such as claims, or chargebacks, or payment reversals). We understand that it may be inconvenient to have your payments temporarily held but please know that we didn't make this decision lightly.
Before deciding to hold payments, we consider many factors. These factors include account and transaction activity, the rate of customer disputes, the type of business a seller runs, average delivery timeframes, customer satisfaction, performance and history.
Questions? Let us know
We understand you’d like to have immediate access to the money you receive and we’re here to answer your questions about this change to your account.
For more information and tips on what you can do to avoid having your future payments held, please see our Frequently Asked Questions. To speak to a Customer Service representative, log in to your PayPal account and click “Contact Us” at the bottom of any page.
Thanks,
PayPal

[jplinville]

One question I have about the situation...Do they have the legal right to do that??

It sounds as if they are afraid that there is going to be widespread withdraws from accounts which could cause the company large amounts of money problems.

[t walgamuth]

Paypal is definately imperfect but still very handy for these type transactions.

Starting a competitor to it would be a good money making idea. Paypal is pretty expensive for what is done so a person could charge half the fees and still make plenty I think.

[E150GT]

I thought that was always the case? I sold a phone in 2009 and they wouldnt release my funds until the buyer posted positive feedback or 21 days had past.

[Eskimo]

I keep up on some aspects of eBay by following some of the discussion on the "Seller Central" board on eBay. From what I've read there, your experience is not unique.

PayPal "21 day holds" have been around for a while. As with many things eBay and PayPal, folks sometimes aren't told exactly what the circumstances are that triggered something - so they don't know exactly what they would need to do to make it stop. I've never been hit by it, so I've never investigated the details.

For PayPal, of course, it has to do with managing risk. Their risk-detector can be pretty twitchy sometimes, and they are typically ham-fisted in the ways they deal - and communicate - with sellers.

[Jim B.]

They are keeping your money so they can enjoy the "float" on it for a while.

They can collect the interest while they wait around.

Multiple this by a million or more customers and you can see why.

And why banks and credit card companies do this all the time and have been for years..


GREED FTW !!!!

[Eskimo]

Originally Posted by E150GT

I thought that was always the case? I sold a phone in 2009 and they wouldnt release my funds until the buyer posted positive feedback or 21 days had past.

I think some categories of items are more likely than others to trigger a "21 day hold", based on the perceived risk of problems in those categories.

[Brian Carlton]

Originally Posted by Jim B.

They are keeping your money so they can enjoy the "float" on it for a while.

They can collect the interest while they wait around.

Multiple this by a million or more customers and you can see why.

And why banks and credit card companies do this all the time and have been for years..


GREED FTW !!!!

Big companies can do whatever they want, to whomever they want for whatever reasons they want. What are you going to do...........sue them??

You can be assured that whatever reason they state will be the exact opposite of the truth.

This company is especially egregious regarding truth. They demand a linked bank account to "increase security". However, if you obtain their credit card, which is done with hardly any requirements, the requirement for a linked bank account is eliminated. They already have two other credit cards on file, and they state that adding a third will give them the "security" they wish for.

Another bunch of outright liars. I'd love to tell them to take their company and stick it but the need to use them for ebay purchases precludes that.

[catmandoo62]

last thing i bought on ebay i just used my credit card.still had to go thru paypal.but don't have a paypal account so to speak as i don't sell stuff just buy.if i want to sell stuff it hits craigslist i ain't payin their fees plus craigs is pretty much local.

[elchivito]

I always grab my $$ out of PP as soon as it hits the account. I sell in random categories though, not in a narrow field. 100% positive FB and never any charge backs. I'll be interested to see if a letter like this arrives. Was it email or a real letter?

[Eskimo]

Originally Posted by elchivito

I always grab my $$ out of PP as soon as it hits the account. I sell in random categories though, not in a narrow field. 100% positive FB and never any charge backs. I'll be interested to see if a letter like this arrives. Was it email or a real letter?

From what I've read, it doesn't require a history of past problems to get a 21-day hold. Just selling something in a category that they consider to be "high risk" may be enough.

100% positive feedback, no complaints, long selling history, etc. don't necessarily prevent the robots from going nuts in response to the slightest hint of a possibility of a problem. IMHO, that's one of the more negative aspects of working with eBay/PayPal. Touch? Tact? Forget about it!

[spdrun]

Paypal + Fleabay management = scum of this earth.

[nate300d]

Originally Posted by t walgamuth

Paypal is definately imperfect but still very handy for these type transactions.

Starting a competitor to it would be a good money making idea. Paypal is pretty expensive for what is done so a person could charge half the fees and still make plenty I think.

My thoughts, too. Just like To send money I find Moneygram has much lower costs and easier to use that Western Union (puke).

[JollyRoger]

Seems reasonable to me, people should be able to get their money back if they have a valid claim.

[aklim]

Originally Posted by Eskimo

From what I've read, it doesn't require a history of past problems to get a 21-day hold. Just selling something in a category that they consider to be "high risk" may be enough.

What are those categories again?

You're selling in a high risk category or industry such as, but not limited to, tickets, travel, gift certificates, computers, consumer electronics, or cell phones

That is the part that worries me. Just like at work when they say "And all duties as specified"