How to cope with PayPal?

[mikea]

PayPal is used by all of the e-cig vendors I've purchased from so far. This is about to become a big problem for me -- over the years I have had a lot of trouble with PayPal's policies and I'm running up against them again.

The company seems to think it should usurp some of the functions of the credit-card company by placing a limit on purchases I can make via their service, even though the limits are much higher from the credit-card company itself. To remove this limit, says PayPal, "all" I have to do is either sign up for one of their debit cards, or turn over my bank account information to them.

That's obnoxious. I do not want another card, and I absolutely do not want to give them my personal bank account information. That strikes me as downright coercive: jump through our hoops, or eventually you won't be able to buy anything through us.

Ok, so never mind signing in to make purchases -- why not just do the 'buy without signing in' routine? It has worked before. Well, suddenly it's not working. The very same credit card PayPal accepts when I log in, they reject when I don't log in -- saying it's "Unauthorized." That's outrageous. Why do they accept it at one moment and not at another?

These unpleasant policies of theirs might make it difficult or even impossible for me to buy from e-cig vendors in the near future, and I'm as angry about their behavior now as I was in the past when this kind of thing was also an issue. HTH to deal with that company, anyway?

I did write at length to one of the e-cig vendors, discussing some of these problems. They wrote back that they are well aware of customer frustrations along these lines (and I am aware of a lot of "end-user" dissatisfaction with PayPal's policies, over the years -- mine included). But vendors like using PayPal because it's so easy for them to set up and use. Clearly they're not going to switch to other payment companies.

So I'm looking at being locked out in some months because I've reached their artificial "spending limit." Bloody frustrating. I have never had problems like this with Amazon.com, or with vendors who use payment companies such as DigitalRiver. Those companies facilitate the e-commerce process. At times, PayPal does the reverse. (Why? What possible benefit does it confer on anyone?)

If anyone reading this has found ways of getting around PayPal's unpleasant restrictions, I will be very grateful for your advice.

[Vicks Vap-oh-Yeah]

Open a new bank account, with bare minimum cash in it - give that information to paypal to mollify them.

[breakfastchef]

I have never had a problem with PayPal. If anything, they want to limit their downside exposure to bad debt by having a backup source of capital if your account goes below zero. I think you can link a credit card instead of your bank account number as an option.

[Skad]

If they are forced to go to some of the other third party merchant accounts, like certain other "high-risk" sites use, then we're going to see much higher prices. PayPal may be difficult, but some of the others charge the vendors as much as 20-30% to process credit cards.

[Drewsworld]

What alot of people dont realize i there is lifetime limit of $10,000 dollars for anyone who dosent have an approrved account (aproved meaning linked to your bank)...I found this out and fought tooth and nail with them...I have exceptional credit and have a credit card that I could spend $100,000 on that has never ever been turned down and pay pal didnt care...I have also seen them freeze peoples acounts and almost ruin them...I suppose it wont be long before someone sues them or some other company gets a similar reputation...the reality is they are very good with most of thier services but are also very bad with some of thier policies and it seems thier attitude is "Take it or leave it"

[Kate51]

Originally Posted by Vicks Vap-oh-Yeah

Open a new bank account, with bare minimum cash in it - give that information to paypal to mollify them.

This is right, Vicks!
Let me put you at rest, a little mikea.
I've been a member of PayPal for 11 years. It had just come into being about that time, and then it had about 10,000 members. Now it serves MILLIONS, world wide. It is one of the MOST secure entities you can use for your business.
The idea that they have "control of your checking account" is a stretch, and it should not be of concern to you to the extent you think this reaches.
Your account with PayPal requires that you have a back-up.
That means two verifiable sources of funding. You can use a CC to purchase, and if all goes well that would be all you needed. However if there is a problem with the CC (over credit limit,expired,fraudulent, etc.) then the transaction reverts to the second verified source of funding, say a Checking Account.
Or, you can make purchases using your Ck acct as default source of payment, with a CC back-up. However, BOTH sources must be active and have money available. The Verification process is simple, go through it the way you're supposed to, and there should be no problems.
Yes, your Client can make purchases from you through PayPal, or by using his/her checking account for an instant trasfer or for an E-Check, which of course takes a couple days to complete. That is more like a NCH transfer. Your client has to have a verified account in order to use your PayPal Checkout.....That takes a load off of you, as a retailer. Otherwise, you would have to wait for the bank or CC purchase to actually clear the client's account before you can send out the item, ok? Stay with me here.
So you are not responsible if your client's account has a problem. However, meantime, if the transaction goes bad (charge-back/CC)
you are out the item you sold, and the money you made in exchange for goods. So for that person's CC to be reimbursed, the money will have to come from your funding source(s). Only for that transaction. If there is not money to cover that charge back, then PayPal can FREEZE your verified sources until the amount in question is paid by you.
THAT IS THE ONLY TIME PayPal has any control of your resources. To avoid a problem with any personal accounts you have registered with PayPal, use a DIFFERENT account JUST FOR YOUR BUSINESS, WHICH YOU SHOULD BE DOING ANYWAY. In the case of a charge-back, it is up to you to fix that transaction, either by proving to PayPal that the item was sent, received, and not returned.

Here it is important for you to provide shipping policies to be able to TRACK and VERIFY RECIEPT of the goods. That is the only proof that PayPal will need from you, THEN they will go after the BUYER to recoup the funds.

Understand? You received money through them, and your client got his money back, so that's the place where you need to cover your backside. It is simple, this is the same way ANY business can recoup bad checks, fraudulent CC, etc.....
If all your "I's" are dotted and "T's" are crossed PayPal is totally reliable and covers bases for BOTH Buyer AND Seller. That is what they do. For a small fee, of course. Remember, there's an occasional bad egg buying, but once in awhile there's a bad egg selling. Try to get your mind around that and that's about all there is to it. Sorry for the wordy explanation, but I've seen a lot of PayPal bad-mouthing going on in the Forum, and it's like people calling their bank a rip-off because their check bounced! Banks do make an occasional mistake, but on average 99.9% of the time the mistake is the fault of the buyer/seller, you can take that to the bank!
Sometimes as a retailer you get a nuisance sale and loose the item and the cash. This is called a LOSS, and that is also reportable at the end of the year when you fill out your business tax return.

[Kate51]

Originally Posted by Drewsworld

What alot of people dont realize i there is lifetime limit of $10,000 dollars for anyone who dosent have an approrved account (aproved meaning linked to your bank)...I found this out and fought tooth and nail with them...I have exceptional credit and have a credit card that I could spend $100,000 on that has never ever been turned down and pay pal didnt care...I have also seen them freeze peoples acounts and almost ruin them...I suppose it wont be long before someone sues them or some other company gets a similar reputation...the reality is they are very good with most of thier services but are also very bad with some of thier policies and it seems thier attitude is "Take it or leave it"

Drew, I think this is still right, but however you are referring to what is called an unverified account. To received verification (which is the only way to go if you run a business) you go through PayPal's process. They make two deposits in the ck account specified, and when that's done you just verify at PayPal that yes, the first deposit for $.02 was on day ____,
the second was for $.03 on day___. That's it. Same way to verify your CC, when you get your statement there will be note of two transactions for a couple pennies, you verify that, and you're done. They already have your bank and CC numbers, not control of your funds. But these must be kept up-to-date, not expirations allowed, and funds available to cover the transaction amount. It's no different than giving a check to a gas station, they don't own your account either, but if the check bounces you will wish somebody else did. Should not be a privacy problem at all, there is no such thing as absolute privacy anymore, even if you send money orders there is still a paper trail.

[Drewsworld]

A friend of mine imported a product called the magic wheel...He recieved payments through pay pal to expedite the process...he did not ship through pay pal as some of the process included large wholesale orders and required trucking companies involvement...Pay pal froze his account and withdrew the money that he ahd transfered to his primary checking and gave refunds to people who hadnt had a problem...Pay pal was adamendt that they were correct and he was told it was procedure...By the time he straightened it out it cost him quite a bit of time and money as well credability with his (new) customers...A venture that could of made him a few thousand dollars and took him weeks of day and late nite communications, ended up costing him about $3000 dollars...Pay pal refuses to repay him or allow him to do future business withthere site...It seems to me they think that thier policies are ireprihensable, regardless of your situation...I agree they are very secure and are the biggest, but maybe they are getting too big to accomodate the people that made them who they are...
Drew

[Kate51]

Originally Posted by Drewsworld

A friend of mine imported a product called the magic wheel...He recieved payments through pay pal to expedite the process...he did not ship through pay pal as some of the process included large wholesale orders and required trucking companies involvement...Pay pal froze his account and withdrew the money that he ahd transfered to his primary checking and gave refunds to people who hadnt had a problem...Pay pal was adamendt that they were correct and he was told it was procedure...By the time he straightened it out it cost him quite a bit of time and money as well credability with his (new) customers...A venture that could of made him a few thousand dollars and took him weeks of day and late nite communications, ended up costing him about $3000 dollars...Pay pal refuses to repay him or allow him to do future business withthere site...It seems to me they think that thier policies are ireprihensable, regardless of your situation...I agree they are very secure and are the biggest, but maybe they are getting too big to accomodate the people that made them who they are...
Drew

I've seen the magic wheels, they are great! But I would be a little suspect that your friend may not have been telling everything...were they banned for some reason, taken off the market, or was the market flawed...something was very wrong. Had to be a complaint somewhere, or why would they refund money to people.....I know, I have heard horror stories, but there is a reason for all of that to have happened. And you don't have to ship through Paypal, that wasn't the problem. Maybe a copyright or inventor got crossed, something. Or manufacture flaw. Very sorry that happened to him. Also something happened bad that he got banned, perhaps funny money involved somewhere, I'm not saying him, but somewhere in the line from manufacture to buyer was corrupt. "knock off's" sometimes get caught, then the whole import/sale chain collapses. ???? don't know. He may well have been a victim, but I still say he wasn't a "victim" of PayPal. Even Customs may have found something, we all know how that works. If so, everyone in that chain suffers the loss.

[Elendil]

For every one "horror" story about paypal there are millions and millions of transactions that go through without a hitch. I have had a verified account for years and with hundreds (if not 1000+) transactions and never one problem. As a buyer, it is to my advantage to be able to use paypal.

Speaking as someone who has been in banking for 20+ years, there is nothing that Paypal could do to your bank account that your bank could not immediately fix. If your bank tells you differently, you need to get a new bank.