PayPal Preparing To Address Frozen Funds Policy

First time accepted submitter skywire writes "After years of forcing innocent customers to navigate a Kafkaesque process to unfreeze their funds, PayPal has announced that they are preparing major changes to alleviate the pain. From the article: 'The company routinely freezes funds for 21 days if it thinks there's a fraud risk, and its terms give it the right to extend the freeze for up to 180 days. To get access to their money, users are often asked to provide the kind of documentation that a product seller would have, like several months' worth of sales records. But if you're running a fundraiser or selling tickets to an upcoming conference, you don't have that paperwork. Even for those with extensive paper trails, the appeals process can take months to resolve. The Web is filled with enraged blog posts, websites like paypalsucks.com, and a Tumblr called "Conferences Burned by PayPal."'"

Comments

Too Late

[QuantumBeep]

After over ten years of destroying businesses and hurting people while hiding behind a blank gray wall of "policy", Paypal are kidding themselves if they think that they can ever recover the goodwill that they've burned.

Re:Too Late

[alexo]

You don't need much "goodwill" when you are the biggest player in the game and have a captive user base.

Re:Too Late

[tlhIngan]

Credit card policies are not very different

Most of the sellers I read about we're just dumb

That's the problem, really.

Merchant accounts aren't too different from what Paypal does in the end - except retailers are often forbidden by contracts to speak about it.

The other thing is, the average Joe cannot get a merchant account, so accepting credit cards is impossible (they often have minimum transactions per month of minimum amount to qualify, else you get the high rate account). Paypal does, however, let the average Joe do that, so if you're running a small shop and can't qualify, Paypal is pretty much your only option.

Especially if you want to sell online (imagine how online auctions go if you can't pay via credit card).

The problem is, most sellers just assume that it's like a cash account and Paypal will hide al lthe fees and crap from them. But given a chargeback can occur easily 6 months from the transaction date, and by default the credit cards refund the money unless the seller can prove the transaction (at which point it's paid back), well, most people are in for a surprise.

I suppose one could take cash or cheques sent through the mail. I'm sure that's viable in this day and age of buying stuff and getting it the next day.

Re:Reminds me of a funny story

[Anonymous Coward]

Well, apparently PayPal thought I was actually paying for sex with PayPal and froze the funds. After I called them and explained the situation though, they quickly released the funds.

The story is not funny at all, but it is indicative of problem with PayPal

The fact that you had to explain yourself before your account is un-frozen is the very reason PayPal should cease to exist. I should be able to write whatever the hell I want on the payment -- unless they have some proof of illegal activity, I should not explain myself to PayPal to recover my account/my money.