Funds Availability

[Havonasun]

I do not hold funds in my PayPal account, I instead use it as a pass-through account to my bank. Today a buyer 'ordered by mistake' and requested a refund. This is seen as a dispute, so I now had a negative balance in my PayPal account. I found this out as I was trying to pay for an item, and it kept coming back declined. 

Why, if I am set up to pay from a bank account, does PayPal feel the need to interfere with all transactions until this negative balance is rectified?

[DPCreations]

You account activity is restricted until you satisfy the debt.  It is stated in PayPal polices about restrictions.

You can fix it by transferring funds from your bank account to PayPal.

[Havonasun]

Except it isn't a debt. "The buyer requested a return, but you're not obligated to accept a return for this item." All sales were final.

An example of why this is a problem... Suppose I am committed to purchase a $100 item, but joe shopper decided he doesn't need his purchase and requests a return of $50. The auction does not offer returns, but this option is available to buyers anyway. Also suppose that there is $0 in the PayPal account, and only $125 in the backup funding account. At this point, PayPal has frozen the account, subtracting the amount requested, waiting for my decision whether to approve or deny the request. Meanwhile, I am unable to satisfy my current debt, for which payment is due immediately.

I was able to deal with this, but you can see how this might create issues. The payment system should not block access to the backup funding account.

[Whac-A-Mole]

yes,you either wait for the result of the dispute to either transfer fund to bring the account to neutral if you lose,if you dont want to wait,then transfer fund now so you an make purchase.