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Discussion Starter · #1 ·
I just signed up for PP .. They responded that they will hold 20% for 30 days... At first I didn't think that much of it. Then I started reading horror stories about PP holding people's money. One guy had $20k frozen with no complaint. I can also see how this might affect cash flow if you have small profit margins. So now I'm rethinking PP..

Have any of you ran into "reserve holding"? Did it affect your cash flow enough to get u to leave PP? If so, who did you go to? Or were u able to get it lifted and if so, how? Or is this a normal practice amongst merchants and it's not that big of a deal?
 

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Once you are Verified, Certified, and have verified your banking and what not there won't be money held like that.

Those are horror stories from people thinking they could just transfer large amounts of money instantly upon creating a paypal account.

Paypal is a bank, and operates just like a bank but is designed for online use. They are very secure and take precautions to avoid fraud just like any other bank, that is why it is so difficult at first since a large majority of fraud take place online.

Hope this helps
 

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I am verified, certified, and have linked my account and even bought a few things for trial runs.
You said that you had just signed up for paypal? It took me a month to get the certified seal... I have had quite a lot of money go through my pay pal and never a problem.

I wonder if it has something to do with where the money was sent from... hmmm, maybe someone else knows more about your issue than I do.

EDIT:I wasn't paying attention.. but maybe you just have to wait the full month and everything will be fine.
 

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Discussion Starter · #5 ·
You said that you had just signed up for paypal? It took me a month to get the certified seal... I have had quite a lot of money go through my pay pal and never a problem.

I wonder if it has something to do with where the money was sent from... hmmm, maybe someone else knows more about your issue than I do.

EDIT:I wasn't paying attention.. but maybe you just have to wait the full month and everything will be fine.
Let me clarify, I've been with PP for years, but never did anything with it ie no transactions. But I did verify and certify and link up etc. Now we ate about to launch so I just signed up with PP advanced (monthly charge) and they came back two days Afyer I signed up and informed me about the reserve.
 

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Paypal only serves Paypal.

Customer buys something through Paypal. You ship it. They tell Paypal that you didn't ship or item was not as ordered (if you send in all the paperwork they require to prove shipment... too bad if you used USPS, no tracking!). Paypal pulls the money and holds it while the dispute is settled. Customer eventually gets their refund, you're SOL. Paypal made their fee + interest on the held money. Too bad for you.

You, as a customer, buy things on eBay. You have a rash of bad transactions and legitimately have broken or unshipped items. You make 3 claims in one month. Since you don't buy much, Paypal shuts down your account for making too many dispute claims. Somehow, scammers who falsely accuse sellers still manage to keep their accounts, usually due to the sheer volume of transactions (thus generating fees taken from the seller).

You join a bulk group buy for a product from China or wherever in a small group that you are a part of online. Since it's being manufactured and crate-shipped, the delivery estimate is well over 45 days. Over 100 people participate, and the organizer runs off with the money. Even though 100 people file complaints with Paypal, they refuse to even investigate at all since it's past the 45 day mark and no longer care.

It's inevitable that you have to use Paypal these days but I would be looking into getting a real merchant services credit card processing account asap. And encourage people to use that. If I had a merchant account I wouldn't even offer Paypal anymore. Credit cards have similar protections but don't end up with both ends abusing it nearly as often as Paypal.
 

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Well Paypal has always been good for me to use. Very convenient. Both as a buyer and seller. I use it fairly often. I also use Square for credit cards on my phone and I'm waiting for the Paypal card reader to show up. There are people with legitimate complaints about Paypal. There are people with legitimate complaints about every single thing on earth.

Consider this, you place ten checks in your bank account. You can't take all that money out right away. You wait a few days and your bank says the funds are available. You pull out most of it, but guess what? Those checks might not have even cleared yet and if one bounces, you have to come up with the money. So all I'm saying is every system has its draw backs.
Try it on a small scale at first to see if it is a good choice for you.
 

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Discussion Starter · #10 ·
Right I get all that but my bank doesn't hold 20% for 30 days. Has anyone that uses PP been affected by this reserve amount? I could see how it could mess up someone's business.

For example (for tge sake of my point) suppose I make $1 off a $10 sale. It costs me $9 to ship out goods. If I receive $10 then I made enough to ship out goods plus a profit of $1 - so yay! But wait! PP takes 20% ... that means they take $2 of that $10 and hold it. So now I only have $8 - not even enough to fulfill the order. So now I have to go "borrow" $1 just to fufill the order and more than likely I'll be charged interest on that loan eatingup my $1 profit. This example seems like small beans but imagine it was $1000 order and I needed $900 to fulfill and PP takes $200 ... I'm in the same boat having to get a $100 loan just to fulfill the order.

So in that scenario I have to drive up prices to increase margins JUST so I can fufil PP's reserve. But holy cow batman.. Raised prices means possible loss of customers!

This is how my brain thinks- am I over thinking this or is this pretty accurate for those who have to deal with PP reserves?
 

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I recently received my "square" card reader.... It is pretty awesome. https://squareup.com/

The app on my phone is really easy to use but they charge 2.75% is the downside. Although they send the unit to you for free if you provide your tax numbers. and there is no other monthly fee.

EDIT: all the funds send to your account daily also, I swiped a card yesterday, got an email instantly confirming it. Then this morning at 2 a.m. got another email saying it will be in my account in 1-2 days... but the money was in my account when I checked my balance at 10 a.m. Its pretty convenient and I can take it with me wherever I have phone service :)

Paypal also offers merchant services but they charge 2.7% and a $5 monthly fee.... and not sure about their card reader (whether or not you have to buy it).

So, if this is an easier solution to the problem.... I don't know, just a thought to add to this topic.
 

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dmMatrix: That's a good alternative to know. I don't know about you, but if I go to a website and Paypal is the only option, then I feel that it's just some hobbyist and not a real, professional company. Since many people think Paypal is somehow better than using a real credit card to buy things (look at your credit card's benefits, you may get things you don't even know about, like extended warranties), a lot of merchants are now putting a Paypal option below standard credit card payments. For Paypal's actual merchant services system, a lot of companies keep it transparent and choose not to even advertise that that's what they're using.

Paypal is, of course, striving to divest themselves of this image, as seen by Paypal options in self-checkout terminals in select stores lately (ugh).
 

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dmMatrix: That's a good alternative to know. I don't know about you, but if I go to a website and Paypal is the only option, then I feel that it's just some hobbyist and not a real, professional company. Since many people think Paypal is somehow better than using a real credit card to buy things (look at your credit card's benefits, you may get things you don't even know about, like extended warranties), a lot of merchants are now putting a Paypal option below standard credit card payments. For Paypal's actual merchant services system, a lot of companies keep it transparent and choose not to even advertise that that's what they're using.

Paypal is, of course, striving to divest themselves of this image, as seen by Paypal options in self-checkout terminals in select stores lately (ugh).
I'm totally with you on that one. I get the same vibe from paypal only sites... I have also run into Amazon checkout only... Drives me nuts. I have so many stupid accounts all to do the same thing.

Thanks for the extra info on PayPal... it looks like they are trying to take over the world ha ha.
 

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Having used PayPal exclusively for 11 years, it has not been an issue....Or at least it has not been brought to my attention......

The great thing about PayPal is you do not have to give a vendor your cc# and they can not take an unathorized payment.....

A bigger problem for buyers is websites that do not show where a vendor is located....That is a deal breaker for many buyers.....
 

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Discussion Starter · #17 ·
I use square when I'm in the road. This is primarily for an online store.

I'm fairly certain the guy said 20%\30 days.. I'll dbl check
I just dbl checked..it's 20% for 90 days!! The agent also told me he did not know when they would review it. To me this is unacceptable therfore I will start shopping for a different merchant. I'll start a new thread sking for advice/experience on that.
 

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Beware when using paypal.

They do not operate under the same regulations as a bank or financial institution. Paypal can deny you access to your money for as long as 6 months without any recourse then you get to play the phone game for months.

This personally happened to me over a dispute and it took months and an attorney to finally get resolution.
Read the Terms of Service.
 

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3,000+ transactions with PayPal over 11+ years and never a hickup.....PayPal is not for everyone but it has never let me down.....
over $12,000 in sales last year, 10k the prior year all through PayPal. Never a problem, thats just us though.
...Paypal can deny you access to your money for as long as 6 months without any recourse...

...This personally happened to me over a dispute and it took months and an attorney to finally get resolution...
Can either of you afford to lose what is currently in your Paypal account if what happened to Rk69rn happens to you? Do you pull funds out when they clear or do you just leave them in there like one of my friends did when they froze his account "because it's so convenient to use Paypal for everything"?
 
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