Negative PayPal balance

[Rosemarch]

Hello,

I suddenly have a negative PayPal balance but I do not understand how or why this is possible. I tried to receive help through the customer service message center but the person was not helpful at all, and then stopped responding altogether (I was not being rude or anything like that).

I was billed for a service I had cancelled quite some time ago. The service had my PayPal cash card information on file. I didn't have enough funds on the card, or as a PayPal balance, to cover the amount and now my PayPal account is negative (almost 200$). I do not understand why the payment wasn't simply declined and why they will not let me cancel the payment. I was told I will have to wait until the payment is accepted and then file a dispute. I just don't understand why PayPal would allow this negative balance and not even inform me beforehand that this would occur.

Any help or advice is greatly appreciated and thank you for taking the time to read (and respond)!!!

[kernowlass]

@Rosemarch 

When you purchase something its never instant from your funding source, paypal CREDIT the seller upfront and then paypal take the wait for the funds to transfer from your funding source, this is so their is no delay in the despatch of your item or service.

If your funds fail to transfer then they will put your account into negative until you pay them back again.

[Rosemarch]

Hello @kernowlass!

thank you very much for responding so quickly! The funding source is the PayPal cash card, which is directly linked to the PayPal account. In their own terms of service, they state that in the case of insufficient funds, the transaction will be declined and not go into overdraft, so I am extremely confused. I have had similar transactions in the past, and this has never occurred before. Why would PayPal be allowed to overdraft a PayPal account, especially without prior notification, for something that should be a relatively simple transaction and not something like a chargeback? If my payment method is declined, there is no loss for PayPal and they are not "pre-paying" any funds. I am really confused and have the feeling there is some kind of error in the way this is being processed. Customer service is not very helpful either.

Thank you to both of you who have responded for taking the time to help me out! I really appreciate it!!!!

[sharpiemarker]

@Rosemarch 

I guess having a card on file with the merchant is different from an automatic payment/billing agreement set up in your PayPal account for your subscription with this merchant.

The transaction listed as a pending temporary authorization (click on the transaction at PayPal to find out) and authorizations puts funds on hold. You must contact the merchant to cancel the service, then they won't claim the payment and the authorization expires in 30 days and funds released. Also remove your card on file from your account with the merchant. 

[Rosemarch]

Hello @sharpiemarker,

thank you very much for your swift reply! I already tried cancelling the service multiple times and their website will not let me remove the card info, only replace it with another valid card. I had a similar subscription in the past, and it was simple to cancel the payment while it was still processing, but here, the cancel button isn't even on the transaction page. I just don't understand why it wasn't just declined since there weren't sufficient funds in any of the accounts/ PayPal balance.