Paypal to withhold 10% for 60 days!!!

[bizmanbob]

I just an email from Paypal today that stated that they would be withholding 10% of all my income for the next 60 days!! They claim it is to cover charge backs. I have had this account for 6 years and only had one charge back!! I do thousands of dollars through them a month. They claim it is because I list my items on eBay in "crafts". Has anyone else gotten one these today?

[GreenBean]

Not today. Had news of this some time ago. Par for the course with paypal.

[bizmanbob]

Really?! When did they announce this?! I looked on the site and there is no notice of it. I called them and they said it was going to affect everyone, not just people selling in my category. They claim this is industry standard now. That is bull****! they cannot treat good customers this way! I can see for new people, but 6 years!!!

[GreenBean]

Ah, it's paypal we are talking about: neither you nor I count with them. Here's some info about this. Kinda a read & weep,imo
View topic - PayPal Explains Holds On eBay Sellers' Accounts

[newstart]

Here's the email I received yesterday:

PayPal

An important change to your PayPal account

Hello _______ _______,

Your business is important to us, and we are working hard to provide an easy, fast and secure payment service to you and your customers while keeping our prices competitive. We're also committed to clearly communicating changes to our policies and procedures. To that end, we are writing to inform you of a change to your PayPal account, which will take effect 30 days from the date of this email.

Beginning 07/24/2009, a small percentage of the total payments you receive will be held temporarily as a reserve in your account. This small reserve amount helps to ensure that funds are available to cover payment reversals or buyer chargebacks, if you do not have a sufficient PayPal account balance and do not provide the funds to do so.

A reserve is like a security deposit for your PayPal account and is standard practice in the payments industry, especially for retail segments like Cell Phones & PDAs where there is a higher-than-average risk of reversals or chargebacks. This does not mean that you have done anything wrong. We are requiring a small reserve in your account because you sell in a category that has a higher risk of reversals and chargebacks and because you are relatively new to PayPal as a seller.

Your reserve amount will be 10% of the total payments you receive, which will be held on a rolling 60-day schedule. That means 10% of the money you take in each day will be held in your account, and then made available for withdrawal 60 days later.

For example, if you receive $2,000 every 60 days into your PayPal account, then a reserve amount of about $400 would be required on a rolling 60-day period. In other words, about $6.67 would be held in reserve each day, then released 60 days later.

If you are a PayPal Money Market Fund customer, you will still earn interest on your total balance while your money is in reserve. Click here for more information or to enroll in the PayPal Money Market Fund.

We recognize this is a change in the way we do business with you. By requiring some merchants to reserve money in their accounts, we're able to lower our own costs. Keeping our costs low helps us to continue providing competitive pricing for all sellers who use PayPal.

If you have any questions about this change, please call us at 1-877-729-7252. We appreciate your business and look forward to a continued partnership.

Sincerely,

PayPal

I wonder if the hold is for eBay sales only.

[SaiJin]

I thought they are extremely ridiculous, but they surprised me for being even more ridiculous.
THere's no way people can make a living like that, specially when they are not making much % off an item at that.

Amazing

[Snagga]

is this on top of the 21 day hold?

[GreenBean]

^^^^both will exist. Hope that it will be one or other

[gurusgrafx]

haven't rec'd any notice of this on any of my accounts yet. da-I mean dang. that really sucks. I don't usually have chargebacks or complaints anyway.

[inverser]

10% for 60 days?! That's ridiculous.

[cashflow]

Is it true that paypal introduce reserve on a large number of accounts....

[Jonas]

I generally view that any money put into a PayPal account is lost for good.

[JamesYaBaoy]

LOL..PayPal is a joke, and not fit for any buisness.

Ive had a few differnt merchant accounts and never had a rolling reserve.

Peel back the worn out welcome mat and look at what's likely the truth at the bottom of this. They are short on funds. They need a 'float' (real business term, go look it up). Your 10% continually rolling reserve is their solution.

Industry standard my bass! 1% is standard on high risk accounts and only on high risk accounts. 10% on the majority of accounts? Bhull Pschit!

I know they're gonna try to make this fly, but I have a bit of doubt about it going very far this time. I guess we'll see what we see...

[TermedPS]

What's next? They just put a gun on your head and rob you?

I wonder if it's the economy that's making them do this.

[GreenBean]

^^^ the economy may have 'tipped' them over the edge. Been on the drawing boards for some time with very very little publicity.

[gurusgrafx]

yeah I'm guessing the economy has a lot to do with it. can't wait till we hit hyper inflation!

[sowhat]

That is just sad.

Really, really, sad that we individual sellers manage our money better than a huge company. Instead of getting mad, we should actually feel sorry for them that they have to lie, cheat, and steal just to stay in business.

Sort of reminds me of that "friend" we all had growing up who always stole from everyone. They figured they could steal from you cause you wouldn't miss it or you could get more.

They should just slap a giant monthly fee on everyone instead of nickel and dime-ing everyone to death. If they would just come out and be UP FRONT about the fees they really want to charge and get it all at once, rather than STEALING it out of peoples accounts, people wouldn't have a problem. Paypal's house is clearly built upon sand.

Not trying to turn this into a church sermon, but Paypal needs to go back to Sunday School and re-learn the song that went like this:


The wise man built his house upon the rock

And the rain came tumbling down


Oh, the rain came down

And the floods came up

The rain came down

And the floods came up

And the wise man's house stood firm.


The foolish man built his house upon the sand

And the rain came tumbling down


Oh, the rain came down

And the floods came up

The rain came down

And the floods came up

And the foolish man's house went "splat!" [clap hands once]


So, build your house on the Lord Jesus Christ

Build your house on the Lord Jesus Christ

And the blessings will come down


Oh, the blessings come down

As your prayers go up

The blessings come down

As your prayers go up

So build your house on the Lord Jesus Christ.

[cashflow]

Ridiculous.....really

[ronaldchen]

Dear ****,


During a recent review of your PayPal account the determination was made to apply a reserve to the account beginning 7-**-09. Your reserve will be set with a minimum balance of $1000.00 to be beginning on the above date. You will be notified if your reserve settings are adjusted in the future.

PayPal will accordingly retain in your PayPal Account 5% of the daily payments until $1,000.00 minimum collateral has been reached starting on the above date. $300.00 was placed into the collateral from funds that were available in the balance of the account. PayPal will restrict payments and withdrawals from your account in order to retain the reserve at the specified level. Aside from the reserve, the remaining funds in your account remain available to you for payment or withdrawal, and you can receive payments as you normally do.

The decision regarding your reserve setting was based on the review of the risk exposure inherent to your account. A risk review is the evaluation of several factors related to an account, which include but are not limited to transactional activity, customer disputes, type of business, credit attributes, delivery and customer satisfaction time frames. Reserves are funds that belong to you, but are set aside to ensure your account can cover transaction liabilities.

[Snagga]

are u kiddin me. what are the details on ur account? age? # of disputes? amount of money coming in and goin out?

[Hottest_eBay_Goddess]

Wow. I don't know what else to say. It's gets crazier and crazier.