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]

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]

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]

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.

 

[Drewsworld]

Kate , Funny I asked him the very same questions and my response was "something sounds funny there" but there wasnt a problem with any other entity other than Pay Pal, or at least that is what he said and I didnt investigate myself....I was personally jilted when they told me I couldnt make a purchase without verifying my accout because my lifetime limit was used up? For a minute I thought i was on candid camera or something!!!! As far as him getting a new bank he did almost IMEDIATLEY, but that didnt help the matter at the time...

 

[Kate51]

I think you can still send somebody money, all you need is their e-mail address, but they do have to register before they can get use of the cash. But I think you can only use the account up to $500 before you have to verify your account now, I looked quick but couldn't find it right off, but I know there is a limit. But verification is a good thing, that way no one but PayPal has any of your financial info.
"Bill Me Later" is a good one also, if a merchant doesn't use PayPal sometimes they have that, and there's one other one also. A LOT of people are NOT using credit cards anymore. I traded mine in for a "money" card a few years ago and have saved thousands $$$. Most banks also have debit/credit cards now, but those are also linked to your accounts for payment. Pretty hard to get scammed anymore, also, or "pfished".

 

[mikea]

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

Well, it might work -- and it's kind of a lot of hoop-jumping-through to mollify them. And what happens when that bare-minumum runs out? Are you suddenly P.N.G. at PayPal? Despite the "quadrillions of people use PayPal and never have a problem with it" responses in this thread, message threads I've seen in other places, over the past several years, suggest to me that there are also a lot of people who have run afoul of PayPal, and to have an account run out of funds in a case like that might be one of those run-afoul situations...

 

[mikea]

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've been making online purchases for years, including from PayPal. The "spending limit" appears to be a new "feature" of the service in my case. It was only within the last couple of weeks that I began getting "here's how to remove your spending limit" e-mail messages from them.

For whatever the reason they set my "spending limit" at something more like $1,000. (There's no way I've come anywhere close to spending $9,000 in online purchases.)

I'll read every word in this thread, carefully, and I'll be interested to see if anyone addresses this one -- mentioned in my original post: why is it that PayPal will accept a credit card when I log in, and yet declares that the same card is "unauthorized" when I don't log in? It's com-bloody-pletely irrational.

Why would a card that will be honored, without question, at every merchant imaginable -- in this country or in Europe -- be rejected by one, and only one, company: PayPal?

 

[mikea]

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.

Most of this response appears to be written from the point of view of a vendor, not a customer or "end-user." Are you under the impression somehow that I'm a business that uses PayPal for its receivables?

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

Imagine a transaction on Amazon.com. The buyer turns out to be in arrears paying off his card and the credit-card company, contacted electronically after the potential buyer has clicked a "Pay now" button, turns around and conveys back to Amazon.com: no way; we won't authorize this payment.

What happens then? Is Amazon somehow going to proceed with the transaction anyway? Of course not.

That system works. My point is: what is wrong with the safeguards, in such situations, that are already in place? Why the additional "layers of abstraction," required by no other type of payment system I've ever encountered on-line? They ask for your card; you provide the correct information; they take a moment to verify it. And you're done.

but once in awhile there's a bad egg selling.

Right. And that is also handled by the credit-card company if you contact them about someone's bad business practice. You, the buyer, are protected by that credit card company.

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!

I beg to differ. This is the second time I have run across PayPal's flat-out rejecting a card from me, a card with no problems whatsoever, issued to someone (me) who has excellent credit. There's no analogy here at all between me, in this situation, and someone who writes a check against an account without funds and then resents the bank for having bounced it.

 

[mikea]

For every one "horror" story about paypal there are millions and millions of transactions that go through without a hitch.

That's heartening indeed. As it happens, I'm trying to deal here not with millions of other people's successful transactions but with (among other things) PayPal's flat-out rejection (as "unauthorized") of a card that every other merchant in the world would accept.

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.

I haven't had any such conversation with my bank, let alone one in which they told me "differently." I will, however...

 

[Kate51]

Mikea,
From your posts, I find it confusing. You started the thread by saying that many vendors use PayPal. And you expressed a particular disdain for it. Look, PayPal is like a clearing house, but if you don't have money in your checking account you shouldn't be buying anything. If your CC is maxed you shouldn't buy anything. You sound totally distrustful of PayPal so I was trying to explain how it works, I guess you just didn't get it. So sorry, if you still don't get it. You have to have an account with them in order to use it. So don't then. Pretty simple. Excuse me for trying to help. Send money orders, or use BIll ME. If you don't care if you have to wait for two weeks for your order, that's ok with me. Paypal is just for convenience anyway. I understand, that's not for some people. Geez. Millions of us just happen to like it and trust it, that's all. It's a simple matter to become a verified member. If you aren't, there are top limits to using it. Apparently you reached that limit, so you must've thought it was ok till that happened. Didn't you know there was a limit? Did you know that some banks won't cash a check for you if you have no account with them? Or they will cash and charge you a fee for it? Yah. This is fine. It's called Commerce. Like putting money in the collection plate at church. If you're gonna go, you gotta pay. (Or you should want to. Somebody's gotta pay the bills.) And if you use your credit card through PayPal and have trouble with the transaction, your credit card company would still be fixing it for you. Golly, you're really mad at 'em, aren't you. And see, if you don't get your accounts verified, you can't use a credit card especially. They need to know that's your real name and your real address on it. Otherwise you could be using mine, if I had one. That's naughty. Oh, and here's a thought...you can even send money to PayPal, that's your money, and when you buy something they use that. You don't need a bank account to do that. But don't try to spend more than is in there, otherwise the sale is voided. And PayPal doesn't have a sense of humor, or any sympathy. They're a clearing house. And, they pay interest on your balance. Now there's an idea.

 

[booboo]

I love Paypal and almost refuse to buy anything online from vendors who don't use it. They have had my bank account number and I their debit card for 10 years+ and never had a problem In fact, I use the debit card as another checking account because it pays interest and you get cash back bonuses every time you use it. They have protected me and got my money back from worthless sellers who tried to rip me off and I've never had a problem with them (knock wood). I buy ALOT of stuff on Ebay and online, and with continued security over 100's, if not 1000's of transactions, I don't understand what you are griping about? I don't understand the log-in credit card question? How would you pay by credit card with paypal without logging in? And why would you want to?

 

[Kate51]

I wish I would have invested in some stocks 10 years ago, instead of spending a fortune through it! Same with eBay!
I'd be in a pickle without both of them, since within twenty miles of home there's a Walmart, an Ace store, and a Shopko. Half the time they never heard of what I want, plus spending half a day going to look for it......

 

[mikea]

Mikea,
From your posts, I find it confusing. You started the thread by saying that many vendors use PayPal. And you expressed a particular disdain for it.

I don't know how you get disdain out of it. I'm describing a problem dealing with their policies and their having rejected a perfectly valid credit card that every other merchant (retail store or on-line vendor) has accepted without question. How do you spin disdain out of that? "Disdain" has nothing to do with it.

Look, PayPal is like a clearing house, but if you don't have money in your account you shouldn't be buying anything.

And where did that come from? Did you see any statement to the effect that I don't have money in my account? You did not. It appears you have been reading something into these messages that isn't in them at all.

If your CC is maxed

And where did you get that idea? It is NOT maxed. Not even close.

You sound totally distrustful of PayPal so I was trying to explain how it works, I guess you just didn't get it. So sorry, if you still don't get it.

Judging by your reply just now, it appears you did not understand the issues I've raised and have interpreted the original message to mean something entirely different from what I actually wrote. It is you who are not "getting it."

Excuse me for trying to help.

The sarcasm is out of place and out of line, considering that your reply misrepresents what I wrote -- and you're responding not to what I wrote but rather to your own misrepresentation of it. Strange sort of "help," that...