New to the community? Welcome! Please read our Community Rules and Guidelines
After many years and millions of dollars in processed transactions, we've successfully had and repaid 10 working capital loans. Now, when we need it the most, we are being declined. I have borrowed and repaid over a million dollars, run several million in transactions annually and have never, ever had any type of account issue.
When I called the Working Capital line, I was told there is no problem with my account, but the decline says that my industry is not eligible. Not sure when this happened, I am certainly eligible to pay over 100K in transaction fees with PayPal each year.
So, I call back a few days later and was advised to try using different categories for my 'industry' on my application. This seems like terrible, dishonest advice, but I do it, all to the same result. Denied.
Has anyone been approved and if so, what category do you fall into?
Do not apply for Working Capital loans. You will not receive approval and your previous experience is not a factor. If you continue to use PayPal, ignore that shortcut link to apply. Ignore any invitation to apply for PayPal credit too. Seek help from other higher interest rate sources. I had to borrow at greater than 600% to try to stay operating. But I could not turn a profit fast enough to outpace that interest. Do I blame PayPal for that? No. The people who make decisions about Working Capital loans, changed approval criteria to curb granting them. Because they panicked from the thought of all those loans remaining outstanding, stemming from a protracted period of decreased revenue from eCommerce sellers. Doesn't matter how many loans you've received and paid. Customer service was prohibited from disclosing these changes. Did you notice the explanation for declines sent via letters did not pertain to you. After nearly 20 declines, I decided the only effective reaction was to curb business with PayPal. No working capital loan, no business from me. Each decline would represent a month I would decline to accept payments through PayPal. But what caught me off-guard, was eBay's decision to process payments with another company. I had to begin using Managed Payments starting in July 2020. When that happened, eBay inadvertently reacted to PayPal for me. Because payments were no longer sent to PayPal. Then I realized it wasn't just the Pandemic that caused PayPal to curb approvals. eBay Managed Payments is likely the primary reason. When hundreds of millions of payments stopped going through PayPal. All of a sudden you have to ask yourself. How are payments to Working Capital going to be repaid on a regular basis? The answer is, they won't. Because PayPal did not disclose what decisions they made about the Working Capital loan program. Is the reason to divest. You can be angry but it shouldn't be because you were not approved. It should be because the company did not share what they were doing. Because they didn't think you needed to know. What eBay did has consequences too. They switch millions of sellers from PayPal to Managed payments. But we no longer had access to funds instantly. Where as every other industry has given sellers instant access to funds, including competing services like Mercari. eBay's Managed Payments launched with a 3 to 5 business day deposit rate! Holidays extend the process. I have incurred hundreds of dollars in overdrafts since being forced into Managed Payments. At the time of this writing my account is overdrawn. But I actually have the money. Normally, I would send an instant payment from PayPal and the money would cover any payments or purchases instantly. The fee was nominal, I don't care about the 1%. Because it is far less than $34 x 7, this is what I have been experiencing since Managed Payments. I posted in eBay forums about it (https://community.ebay.com/t5/Payments/Managed-Payments/m-p/31171008?nobounce#M84075). Anyway, eBay did what PayPal did. They did not ask me if my business would be negatively impacted if I no longer has instant access to funds. So I am doing to same thing with eBay. I use to think that building a business with an excellent reputation even if unprofitable for me is what mattered. Because eventually eBay would offer incentives and privileges to sellers that achieved at levels they deemed exceptional. Like the credit bureaus, eBay and PayPal became large enough to establish their own inclusive systems that participants could build and benefit from. That's why PayPal has Working Capital, and as a participant you wouldn't need to looking anywhere else because everything was conveniently streamlined. I use to think eBay's feedback system would become like a credit ratings system. But that hasn't happened. Anyway I attached screenshots of my current chase account balance and my eBay Managed Payments. As you can see, a payment was carried out today. Even though it was suppose to occur yesterday. But yesterday was Memorial Day, so they pushed it to today. My account is currently overdrawn, and more charges have yet to post. But there is nothing I can do about it. Except to stop doing business with eBay too.