Trouble Connecting Squarespace Payments to PayPal Business Account

[MHWallace]

I'm trying to make connection from Squarespace website to PayPal business account. On PayPal side, I've got bank and credit card linked and verified. It is a business account with an email that is not used on a personal PayPal account. Have followed Squarespace and PayPal directions closely. I go through PayPal authorization and am sent back to Squarespace. It appears that Squarespace then makes one more call to PayPal regarding Preapproved Payments.

Specific error msg is: "Sorry, we weren’t able to set up preapproved payments at this time. To comply with government regulations, this transaction has been declined."

Can anyone shed light on what the issue might be? Please let me know if there are other details you need to help find an answer. Thank you.

[MTS_Jennifer]

There are few reasons you may be receiving that specific error message. One of which is you are testing your checkout with your own live PayPal Account, since it is considered Cash Advancing, which is a Restricted Activity  you will receive an error message blocking the payment attempt.

The other possibility is that the business type is a Restricted Business Category that is prohibited from Processing Payments.  Here is additional information from the PayPal Acceptable use Policy.

You can also update your Category and Subcategory in your Business Account to better reflect the products or services that your business is providing:

Here’s how to update your Business Information:

1. Log in to your PayPal account.
2. Click the Business Profile icon beside "Log out" and select Profile and settings.
3. Click Update next to "Business information."
4. Click Edit.
5. Update your Business Information, and then click Save.

If you do not have a restricted Business Category, you can also contact Customer Solutions to verify that the correct Category and Subcategory was chosen for your business type.

Thank you,

Jennifer

[MHWallace · Accepted solution]

To start, my business does website design and development, my client is a business incubator. Nothing about anything either of us does is in the restricted business category. As best I can tell we're not doing, or even trying to do, anything contrary to acceptable use policy. I am using my business PayPal acct to test a client's Squarespace website. Just wanted to test that the connection could be made before I tell the client it's ready to go. (What we are trying to do is to my knowledge legal, but unusual. Accept payment for goods purchased by persons visiting my client's website. Those goods are being sold by what essentially would be a sub-contractor. We wanted payment to go directly to the sub-contractor. For testing purposes my business PP acct is no different that these "sub-contractors.")

I've gone round and round for hours with Squarespace and PayPal customer service. There is something about our situation that is causing the error, but have not been able to figure out what it is. When I use the same PayPal account to connect to my own business Squarespace website to my business PayPal account it connects just fine, in about 5 minutes. I gave up on PayPal and tried Stripe for the test from my client's website to my Stripe account. Connection was made in short order. So, I don't know what the issue was and maybe at some point I'll test it with someone else's PP account. In the meantime we've determined another way to do what it is we are trying to do.

For now I'm marking this as resolved, although it's not really resolved, just in limbo.