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Anyone have issues with the new Paypal Rolling Reserve?

    Aug 13 2009 03:18:22

    #1

    Michael Schwab

    Join date : 2008-09-18      Posts : 87

    We've been with Paypal for over 10 years, and have had excellent service.

    I just spoke with a colleague who just got nailed with the Paypal Rolling Reserve policy- they snagged over $1200 in recent transactions, at 20% reserve rate for her store, for the next 60 days...she's livid.

    They began back in Dec. 08, and says they will have everyone in rolling reserves by October 09.

    We understand the need to protect everyone from risks associated with using online merchants for money exchanges, but can they legally hold 20% for 90 days??

    We're removing the Express Checkout button from our store's checkout front end, until we learn more. When they start holding funds on a daily basis, we'll have to consider removing Paypal as a payment option, altogether...

    Just wondering if anyone else here is already affected, and how are you dealing with the changes?



    Aug 15 2009 15:30:41

    #2

    Neil

    Join date :      Posts : 0

    "can they legally hold 20% for 90 days?"

    Hmm...legal and PayPal have always been worlds apart - it's why they copped so much flak and all those PayPal Sucks web sites etc a few years back before eBay bought them and gave them a "little" bit of class - because they are not governed by any of the usual regulations that financial institutions are. Basically, if they don't want to give you the money you received you have no legal recourse whatsoever.

    Here's the relevant policy update for users here in Oz:

    *****
    Amendment to the PayPal User Agreement

    Beginning 7 May 2008 the PayPal User Agreement for Australia is being amended as follows:

    The following new language will be added to section 11:

    Reserves for Premier and Business Accounts. PayPal, in its sole discretion, may place a reserve on funds held in your Premier or Business Account when PayPal believes there may be an increased level or risk associated with your account. If PayPal places a reserve on funds in your Account, the will be shown as “pending” in your PayPal Account. If your Account is subject to a Reserve, PayPal will provide you with notice specifying the terms of the reserve. The terms may require that a certain percentage of the amounts received in your Account are held for a certain period of time, or that a certain amount or percentage is held in reserve. PayPal may change the terms of the reserve by providing you with notice of the new terms. In the event you do not agree to the terms of the reserve, you may terminate your account with PayPal.

    *****

    That last sentence answers your question perfectly. :)

    Sadly, it's the risk we all take with offering PayPal as a payment option.