PayPal and how it treats its long standing business accounts! Must Read

Mat1330
Contributor
Contributor
I have been in business for 4 years. 90% of my Business transactions have been thru PayPal. In 2015, I processed 277 payments for the year and 2016 I processed 486 payments. There has been a small number of disputes over the years and even a smaller number that has not ended in my favor. I started using PayPal working capital in 2015. I started out with a good size loan and that helped my business. Throughout much of 2015 and 2016 the 5 total loans increased my business so much I was able to add another branch to it. ( Selling Reptiles to now Reptiles and Exotic birds). With that being said November and December of 2016 along with January of 2017 was great months for business...... So well that January alone surpassed my yearly total in 2014. That excitement lasted until I received my email from PayPal that my account needed to be reviewed. I submitted all of the information and gave merchant review all of the info they asked for. I was assured it was a system error and my account would be ok. TWO days later, I received an email that my account has been permanently closed with no option to dispute!! Apparently, animals are a high risk business yet PayPal had no problem processing all of those payment for the last 4 years. I immediately called PayPal and received little to no remorse about the situation. Here is a business that has had a long standing positive reputation with PayPal get closed down. Just because my sales volume increased drastically. Thanks mainly to working capital loans. I did everything working capital was designed to do and was brutally punished by PayPal! *increase business *increase sales *increase company size When I talked to PayPal working capital they apologized to me about this situation. It seems the two companies are related but do not follow the same guidelines. They even locked all of the funds in my account for the next 180 days. I did have around a $1000.00 in the account with orders to still be shipped. I had to cancel those orders and refund my customers as I would not see the money for 6 months. PayPal certainly hurt their reputation in my eyes and in the eyes of the thousands of potential users on my social media accounts. I would have never expected PayPal to treat a loyal customer like this. There needs to be some serious modifications of your decisions and how you treat your customers. I may be one person but if you do this continually, that one person may turn into hundreds, thousands and eventually you will be closing down.
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11 REPLIES 11

sharpiemarker
Esteemed Advisor
Esteemed Advisor

Do you know how many active accounts PayPal currently has? 200 million. They got accounts coming outta their ears.  I dunno...at this point, keep your momentum with a credit card merchant account instead.

 

PS. Increasing your business is fine but with that PayPal expects you to be responsible for managing risk too.  Lean on them less and less. I've had as much number of trans but I had no disputes.  Any problems, which were rare, I handled on my mind own. Didn't ask PayPal for help to resolve them, nor would I let it get to the point the buyer felt they needed to file a dispute.  I don't know if people are aware of it but you can have disputes, just be prepared to handle them and not get PayPal involved.  PayPal have closed down folks that sold a lot more than us so they do not play around with risk


Kudos & Solved are greatly appreciated. 🙂
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sharpiemarker
Esteemed Advisor
Esteemed Advisor

People use PayPal and close themselves off to anything else that may affect their business. Only when there is problem, they realize it.

 

Not doubting that there are unsatisfied users but yet PP are still around.  200 mil strong.  Even though those who can't use em find ways to use it.  The thing of it is, when PayPal works, it's hard to beat, fun to use, very convenient and worldwide, not to mention, they were the first of its kind.  Accept the limitation for now. Wait six months to a year and contact customer service about possibly restoring your account.  It's not guaranteed but they might reconsider.  But you have to show you pose no risk with your transactions if they are increased.  Nip problem orders in the bud before they become PayPal disputes.


Kudos & Solved are greatly appreciated. 🙂
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Mat1330
Contributor
Contributor
We are talking less than 10 of disputes out of 1000 or so lifetime individual sales. My business also relies on FedEx,ups and the airlines to do their job and make sure the animals arrive alive. Some customers first reaction to a DOA order is to immeadietly open a dispute. Those are handled promptly. Others try to steal animals by opening a claim in hopes PayPal will refund them. Some of my single transaction amounts are between 5 and 10 thousand dollars. PayPal essentially is a money broker. That's all! They handle the money and charge a fee. They couldn't eat the loss of a high dollar sale so they kick us to the curb. Even after 4 years of strong positive history. I have no use to go back to PayPal. I wouldn't support that company if it was the only one out there. They treated a long standing customer like garbage, took the money from the transaction fees and threw me to the side. Square so far has processed $40,000 in the last 4 weeks. I'll gladly send my business to them.
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sharpiemarker
Esteemed Advisor
Esteemed Advisor

They do not see it that way.  You have to operate under their terms.  If your sales increase, your disputes may as well is how they look at it.  Doesn't matter how you view them.

 

Square is smaller so of course they will accept your business.  Glad it is working out for you and able to make the transition.


Kudos & Solved are greatly appreciated. 🙂
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Mat1330
Contributor
Contributor
I realize your job is to save face and make PayPal to appear better than what it looks but PayPal clearly made a bad decision and will lose several thousand dollars in transaction fees that they could have had on a yearly basis. So here is the exact email below. I did everything PayPal working capital was designed to do and this is what I got for it....... Dear Michael Matson, We have reviewed your PayPal account and, due to the excessive risk involved, we would like to begin parting ways. As a result, your PayPal account has been permanently limited and there will be no appeals to the decision. We looked at several factors to determine the high level of risk associated with your account. These factors include: · Overall processing volume – There is a significant change in the level of payments your business is processing compared to your processing history. · High risk industry - You are selling merchandise or services in what we consider to be a high risk industry.(Animals) · Significant change in average sale price - Your average sale price has changed significantly.
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DPCreations
Frequent Advisor
Frequent Advisor

Seems pretty clear.  Your business was high risk and PayPal needs to protect its own financial interest.

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Mat1330
Contributor
Contributor
So it took 4 years for them to randomly decide that? The product has been the same throughout the entire use of PayPal. I guess once I started making real money they didn't want to be apart of it as they are a broker essientially and could not absorb a high dollar loss. Totally understandable to do something like this if I was apart of PayPal for a few months.... Not a loyal customer for 4+ years that not only uses PayPal but also PayPal working capital. Once again, this was poor treatment and a bad decision and I am only exercising my right to voice what happened. It seems to be catching some responses from the prominent paid employees on here hired to do damage control.
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DPCreations
Frequent Advisor
Frequent Advisor

No one here doing damage control.  It seems that your own business practices were your own self business damaging practices.  There is no damage to PayPal.  PayPal is just taking measures to avoid damage to it's business and financial system.

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Mat1330
Contributor
Contributor
I'm curious to what business practices you are talking about? Increasing my average sale amount? Increasing my avg volume of sales? You take that as a bad business practice? I am one of the top suppliers in my industry. PayPal just has a poor understanding of what high risk means. Animals have 2 possibilities. They either arrive alive and well or dead. Women's clothing is a high risk item. Several factors could lead to a return of an item or a dispute...
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