New to the community? Welcome! Please read our Community Rules and Guidelines
Pay, shop, and do even more on the PayPal appGet the App
If PayPal would have contacted me in advance to let me know this was a legitimate PayPal transaction then I would not have suspect fraud and unlinked my account. I wonder how many others have done the same, and how much this costs PayPal in the end.
I just closed my checking account because I received a notification of a pending Prenote deposit of $0 from PayPal.
When you Google this, most of what you find online is that a Prenote indicates your banking information has been compromised and someone is testing the waters to see if they can access your account.
If PayPal would require account verification it seems like this concern would be addressed. Is this something PayPal is considering?
I noticed it today on one of my accounts that I rarely use for PayPal transactions, so rare that I thought I deleted it years back, but didn't. I called my financial institution and they're putting a freeze on my account for 3-5 business days and giving me a new account number.
I would think that Paypal would at least let us know in advance that they do this on occasion. This bring uneeded stress!!!
Not sure if you're a PayPal employee or not but if you are I suggest making a recommendation to notify users when their account information is verified periodically. This just happened to me today without any warning and caused a panic that my account had been compromised. The alternative is to periodically e-mail account holders asking them to login to PayPal and verify their banking information manually. This way the account holder is aware of this prenote check and doesn't cause undue alarm, or in same cases a full account closure at the bank to avoid fraud.
Just my two cents though.
Is there any explanation as to why I get this $0 transaction with my bank every 2 weeks? This has been going on for 2 months now.
I just saw the prenote transaction on my checking. The problem with saying it's a non-issue however is that account is not linked to any PayPal account. My PayPal account is linked to a completely different bank, and I did not get the notification on that account. My bank said they had that notice on several accounts and that as of now nothing has come of it. They also said it's directly linked to my checking and not a transaction on my debit card. If PayPal is doing this, then I would like to know how they accessed my bank that isn't connected to my PayPal account and why did they not test my bank account that is. None of this is good business practice and it needs to simply stop.
How to determine if the PRENOTE is legit.
Since I could not find this information on line - I figured I would help anyone else with the answer.
PayPal has been under fire for not doing these and they are basically checking every account - even old and closed ones. However, this does not help you when PayPal does not log this information on your activity log because technically, it is not a "transaction", it's a "prenote", other wise known as a validity check. In banking terms, this is not a transaction.
So how do you tell?
1. Call PayPal and ask them to do a search by bank account number to verify that no one else has set up an account using your bank account information. You will need your full MICR number. They do not need the ABA (Routing) number. Their system is not supposed to let you do this, but it still happens from time to time. If your the only PayPal account with your bank account number you are good on the PayPal side.
2. Call your bank, ask them to look at the prenote and the last ACH withdraw or deposit you received from PayPal, even if it's years old. Have them compare the "ACH Originating DFI ID." This is like the ABA or routing number. It is unique to every financial institution and guarantees that the ACH prenote originated from PayPal's bank. If the numbers match, then you are good on the banking side.
Some banks put this information on your statement. For instance, my bank lists the full "TRACE NUMBER" on my statement. This is the unique transaction serial number which is used by the banks to trace or track ACHs. The first 8 numbers is the ACH Originating DFI ID. For instance, my statement included the following:
ACH Comment / PAYPAL PAYPALPRNT PRENOTE 220725 PRENOTE 091000013xxxxxx: Prenotification Credit Entry (the last six numbers were removed for security purposes).
The ACH Originating DFI ID is 09100001 and this matches every PayPal transaction I have ever done.
Because they all match, the risk is very low. It would be highly unlikely, if not impossible, that a threat actor could set up an account with the PayPal name at the same bank PayPal uses.
Now what if the ID is different? You have two options. Close the account or have your bank "block" all ACH to that ID. Discuss this with your bank and follow their advice.