Seller Hits Unexpected PayPal Ceiling - EcommerceBytes

Summary

Did you know PayPal has a ceiling on how much you can process through its service before it will begin instituting payment holds on your funds?

Did you know PayPal has a ceiling on how much you can process through its service before it will begin instituting payment holds on your funds?

A reader who sells on eBay and on his own website received an email from PayPal a few days ago with the subject line, "Some money from your sales may be placed on temporary hold."

It informed the seller he was now "nearing the amount that will be immediately available to you from sales each month, so some money from your sales may be held temporarily."

It instructed him on how to request an increase and explained: "You can easily request that more money be available to you sooner. We'll also periodically adjust this release amount to match your business growth. And, if business is a little slower one month, the amount available to you won't be reduced."

But 24 minutes after he received the letter and requested an increase, he was turned down. The reason for the rejection: "We noticed an unusually large increase in your sales activity."

However, the seller told EcommerceBytes, he had experienced no unusually large increase in sales. In fact, he explained, "Because eBay no longer send payments to PayPal, and the simple fact I have changed my business a bit, my PayPal activity has dropped."

Included in the rejection email were some suggestions: "In general, following these ideas will help you have more money available to you." It included the following suggestions:

- Avoid long refund times.

- Ship promptly and provide valid tracking through PayPal.

- Work closely with buyers to avoid chargebacks and claims.

The seller called PayPal, and a representative confirmed his account wasn't showing problems with chargebacks, shipping times or refunds. But after the rep sent another request on his behalf, the seller received another rejection for his request for an increase.

"I am pushing to change my web site to not take PayPal at all, I'm tired of how they treat sellers," he told EcommerceBytes.

PayPal has used payment holds to manage risks for well over a decade, but as shown in this example, it can blindside sellers. In this case, there also seemed to be a disconnect between PayPal messaging and what the seller was experiencing (he said he didn't have an increase in sales activity and did not have any issues with chargebacks, shipping times or refunds).

We'd like to know if readers have experienced any unexpected payment holds on PayPal or other payment processors and if they seem justified. And if you have advice to offer, feel free to share in the comments below.

Seller Hits Unexpected PayPal Ceiling - EcommerceBytes
Photo Credit: EcommerceBytes

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