Dear Pay Pal,
Congratulations on (FINALLY) recognizing that your previous policy to hold funds during disputes was self-defeating. As you know, when a credit card charge back occurs or an Ebay sale has a dispute between the buyer and seller, Pay Pal placed a hold on the funds until the charge back or dispute was resolved. Of course, this frustrates the Pay Pal account holder, who may have done nothing wrong yet is unable to access their own earnings. One immediate consequence of these holds was that Pay Pal account holders removed excess funds from their account at least daily and perhaps more often. As a result, Pay Pay lost access to interest free dollars and incurred lower profit margins.
A second and perhaps more costly Pay Pal failure occurred when Pay Pal account holders filed a complaint online with the US Consumer Financial Protection Bureau (CFPB) about the hold on their own funds. Few Pay Pal account holders realize that Pay Pal is regulated by the CRPB and a complaint requires a formal response from a Pay Pal contract attorney. Regardless of the merits of the complaint, no doubt the response letter is exceedingly costly. Pay Pal has finally recognized that it was just too costly to anger Pay Pal customers through predatory and unfair hold practices and it was more reasonable to give their better customers the benefit of the doubt. Hence the new policy. My only comment is that it took far too long for Pay Pal to recognize their own failure and provide a remedy.
