PayPal pending payment

[socrcoach17]

I would like to hear from someone at PayPal the answers to several specific questions relating to the pending payment policy. I have read the various threads on this, and the relevant section of the Terms of Service Agreement, but these are questions not answered elsewhere.

FIrst, the background. Like so many others here, I was caught by surprise when payment was held up for an item I sold on eBay. The item sold for $455 and because it is heavy and bulky, the shipping charge was $225 (in the actual fact, it cost me more than that amount to pack and ship and I ate the difference). The winning bidder paid immediately via PayPal. PayPal immediately marked this as a "pending" payment. The item was shipped less than 48 hours after the auction closed and delivered yesterday. I supplied the tracking information to PayPal/eBay as instructed. The payment still shows simply as "pending" and when I click on "Details" I am told that status applies for another 14 days, OR 3 days after PayPal can determine that the item was delivered, OR 3 days after the buyer leaves positive feedback.

There is no way for me to verify that PayPal/eBay knows now that the item was, in fact, delivered yesterday. There is no way to know when and if a change in pending status has occurred. The policy is ambiguous as to whether delivery even matters for an eBay auction item, or if only positive buyer feedback will release the funds in less than 21 days.

QUESTION 1: If the item was sold pursuant to an eBay auction, is the pending status changed when the SOONER OF or LATER OF the two listed events occur: provable delivery or positive buyer feedback? How can I verify that PayPal now knows the item was delivered and, therefore, that the 3-day clock has started to count down?

PayPal positions itself as the most convenient way for a seller to accept payments, especially on eBay transactions. I was charged a $20+ fee for this transaction. I had to front the $225 shipping charge. I now have to wait an arbitrary amount of time for payment, with no feedback from PayPal as to status before or after the buyer submitted his PayPal payment transaction. In the very best case, the funds will hit my bank account two weeks from when the auction closed because of the holiday weekend.

QUESTION 2: Why is this good for me as a seller? You are charging me premium transaction fees, what service am I AS A SELLER getting in return for this policy and the fees charged?

The most basic tenet of contract law is that the parties have to agree to the terms in order for there to be a contract. PayPal's Terms of Service Agreement relating to pending payments is hopelessly vague, to the degree that I question that it constitutes a contract. It would not be a valid contract for me to say, for example, "I can do whatever I want for any reason" and for you to agree, and for me to then take your car and your house. I could argue that your agreement was stupidity on your part (which is, essentially, PayPal's response to sellers in the various threads and is vaguely insulting), but I could not defend such capricious actions in court based on that "contract." Particularly in a dependent situation like this

The PayPal pending payment policy does not, for example, let me know, as a seller, whether I or any given transaction are subject to being pended, what I can do to prevent it, or what specific criteria PayPal will use. PayPal relies on terms like "high risk" that clearly mean something very different to the sellers who have spoken out in this forum than they mean to PayPal. In no way would I, as a reasonable seller, read the text of the TOSA and interpret it as meaning what PayPal is, in fact, doing. You are doing things that are not reasonable interpretations that a reasonable seller would be expected to conclude are consistent with the TOSA's language. They appear to be arbitrary and capricious and unrelated to the stated policy.

In short, a seller "agreeing" to the TOSA can have no basis for understanding what it now turns out PayPal means by those words.

QUESTION 3: How does the TOSA, regarding pending payment holds, constitute a valid contract, given that you provide no way for the seller to know what he/she is agreeing to and that reasonable sellers clearly think you are interpreting this language in ways opposite to the way they understand it?

Given that PayPal relies on its "sole discretion," there is an implied obligation for the policy and its enforcement to rationally relate to its purpose.

As with so many others, there is no evidence in my case of any kind of a problem. This was a personal sale, but I own a company that accepts credit cards based in large part on my own credit history, and have had no problem with approvals for those transactions from banks, or any problems with any specific transactions. There is no history of complaints against me personally or my company, I have no criminal history, no financial fraud, solid credit rating, bank account has been verified. In other words, PayPal has reached a decision about my "risk" that is opposite what other financial institutions that provide similar services have concluded.

QUESTION 4: How does the pending payment discretion policy of PayPal rationally relate to actual risks to buyers, its putative purpose? What does the term "high likelihood" mean anyway - 50%? 10%? 1%? What statistical evidence does PayPal have that the criteria used are predictive of a "high likelihood" (whatever that means) of buyer dissatisfaction? Is there any such evidence at all that eBay frequency is a reliable predictor, or is this just someone's guess?

Clearly, this policy benefits PayPal financially. You get the benefit of interest on the funds while they are in pending status. It is like travellers checks - the financial institution makes money on the float. Therefore, PayPal has set itself up with a clear conflict of interest, between fairly interpreting ambiguous or discretionary sections of the TOSA, e.g., what constitutes "risk" to buyers, and what is financially beneficial for PayPal.

QUESTION 5: Will PayPal remove this conflict by paying interest on the funds held? If not, how can you claim to not have an egregious conflict of interest in your unilateral interpretation of the TOSA?

[femsol]

---

@jeriv wrote:

You don't have to wait for feedback. Three day's after they receive the item call customer service and you'll get your money released immediatly. Make sure when you ship the item you also get conformation of delivery.

---

That is so not true!  PayPal and PayPal employees that troll these forums can keep stating the party line about having their funds released  in 3 days without the buyer's feedback or even with the buyer's feedback.  However read through pages of these forums or at least the most recent ones--especially those on the board entitled "Horrible Idea to hold funds" up to 150+ pages and read about sellers who are still waiting for their  funds despite delivery and tracking numbers, postive feedback, long time sellers with 100% perfect feedback and after repeated attempts and phone calls to eBay and PayPal they are still  experiencing holds up to 21 days.  I recently read about several sellers who had been on eBay before PayPal was owned by eBay, as was I, and they had their funds released in January or February and told no more holds and then the last two weeks PayPal swooped in again to hold their funds.  Interesting that these holds and releases always come before and after eBay has to post its quarterly earnings.

If you were lucky enough to have your funds released in 3 days simply by providing a delivery confirmation than congratulations--but you should know that is the exception and not the rule.

[pssst]

To me its not just about  paying for the item to be shipped, its knowing that I am expected to ship a item that cost me money and that I have not been paid.  Payment to paypal is not payment to me.  I dont go into a store take a item and then say wait 21 days and if everything is just peachy you may get paid for it, (OHHH you MIGHT get it a few days sooner). 

This is theft, a third party has helped itself to money it wasnt entitled too and then demanded that I ship a item (of any value) for free and risk never recieving payment or reimbursment for the shipping charges or the item sent.

I have 100 percent feed back with a 47 rating, i sold items and people recieved them and now I am expected to go another ten miles and just give my stuff away and hope the 21 days later I get my money. I am OFFENDED. I am thinking of just closing this account down I dont need this and I will not ship without having been paid.

Paypal needs NEW management because it hasnt figured out that it is NOTHING without sellers. IF I was a CROOK i would shop at PAYPAL, pretend everything I got was broken and ship back rocks.....ITs not like PAYPAL cares.  THE crooks already know this, so am I going to ship a item I paid 200 for  without me being paid.....NOPE.

THIS isnt to protect the buyer its to help SCAMMERs rip sellers off

ADVICE TO SELLERS refund the money immediately (tell them its broken, or that the money is on hold and you cant ship, be polite)  and file for your seller fees back, its shows just how much ebay cares about its seller when ebay doesnt automatically give fees back when its system knows that the payment was refunded.

EBAY AND PAYPAL you were good before you became one now your RIDICULOUS. Crazy and unfair.  Seller cant leave bad feedback when they have been hassled and now we GIVE stuff away.....or we just go away!

[JFTECK]

Why you Ebay do that?

On March 9, 2010, buyer John Gillon from 550 Spring Farm Court, Lewisville, NC 27023, ebay user name: thegillons. Order our product: Caller ID with Ring Controller.

We shipped item on March 10,

John Gillon, received the item and no complain, he did not ask return and not return this unit too.

But I do not understand why you – Ebay, take my money from my paypal account and give him refund?

Please read following information:

***************************************

Buyer

John Gillon

thegillons

The buyer hasn't sent a note.

Shipping address - confirmed

Mar 9, 2010   Payment From John Gillon Refunded Details

 Payment From John Gillon 56R411916H2423340 Shipped, Track

 USPS Tracking No.   $77.95 -$2.56 $75.39 USD

Select record 17   Mar 25, 2010   Fee Reversal From Cancelled Fee Completed Details

 Fee Reversal From Cancelled Fee 4NG296756Y433202S   $2.56 $0.00 $2.56 USD

Select record 18   Mar 25, 2010   Refund To John Gillon Completed Details

 Refund To John Gillon 80M04105X99826048   -$77.95 $2.56 -$75.39 USD

Refund (Unique Transaction ID #80M04105X99826048)

In reference to: 56R411916H2423340 

Original Transaction

 Date  Type  Status  Details  Gross  Fee  Net

 Mar 9, 2010 Payment From John Gillon  Refunded  Details  $77.95 USD  -$2.56 USD  $75.39 USD 

Related Transaction

 Date  Type  Status  Details  Gross  Fee  Net

 Mar 25, 2010 Refund  Completed  ... -$77.95 USD  $2.56 USD  -$75.39 USD 

--------------------------------------------------------------------------------

 Sent by:

 John Gillon    

 -$77.95 USD

Fee amount:

 $2.56 USD

Net amount:

 -$75.39 USD

--------------------------------------------------------------------------------

Date:

 Mar 25, 2010

Time:

 17:26:53 PDT

Status: 

 Completed

----------------------------------------------------------------------------

[pullmyfinger]

This is somthing ive been struggling with for several days ,i wanted to be a power seller i have alot of inventory i put many items on at once ,but now im finding that i basically  have to pay for shipping and wait for the doom word(pending) to change ,for what 21 to 16 days then the funds will be made available? When you decide to go to the grocery store and buy food from them ,load your cart on everything and anything you want then just walk passed the clerk and toss a note in the air and it reads "I put what i owe you in a magic piggy bank,when the moon and venus eclipse and that then creates the snow flower to blossom the money will become available","thank you come again." I now have to sell fewer items because im not banking a large amount of money ,ive just started out and money is tight what i had to start with was hope that i could do something with what little money i had to spare and make a honest business now im stuck  with the realization that im going to have to leave  any profits in  my paypal account to fund shipping and handling for the future items i want to list, I have to have what ever i want to sells insertion fee , final fee and now shipping and handling fee in paypal account for each item .Talk about kicking a guy when he's on the ground.

[LizaShaw]

I am curious about something:

The Shipping Policy that is right on my sold item's listing reads "Will usually ship within 2 business days of receiving cleared payment."  This language was the default (PROVIDED BY PAYPAL!!!) that came up after I completed the "sellers information" during the initial listing process, and all I inputted was the amount of days it will usually take for me to send off an item.  Of course, this language is nebulous and does not indicate to either the buyer OR the seller, whether the money in question must be cleared into the seller's BANK account, or the paypal account. 

You see, what a lovely double-bind Paypal has put me in!  I am not obligated to send this buyer's item until I receive the money in my BANK account (THAT IS HOW I INTERPRET IT, PAYPAL!  THAT'S HOW THE *SELLER* IS PROTECTED!!!).  But, I can't get the money until the buyer has received my item and is pleased with it?!?!  HELLO!?!?

Just how exactly does this policy protect sellers?  I am left wondering, "What if the buyer simply CLAIMS I never sent the item?  He has not asked for shipping insurance, nor for any tracking information.  What's to stop the buyer from claiming it must have gotten lost in the mail?  What if he receives the cell phone I suposedly sold him (although have never been remunerated for), but forgets to give positive feedback?  What if he claims the phone arrived broken?"

In the past, the protection I had as the seller, was that I knew the burden of paying for shipping insurance was on the buyer.  If the shipping service did a crappy job and the item arrived broken, this was the buyer's problem. If they bought shipping insurance, they were covered.  If not, they were SOL.  I had been paid for the item, and it left my hands in working condition from the postal/shipping company.  Now, the burden for this is on the seller!  If the buyer is unsatisfied with the product as a result of circumstances outside of a seller's control, this sets us up to not receive our money, and on top of that, we are out our product!!!  Not to mention that we will never get back all of the time we spent listing the item, preparing the pictures, packing the item, going to the shipping location, and shall we even mention the FEES that ebay and Paypal take???

This is just disgusting, in my opinion.  I understand charging me a transaction fee, and I am willing ot pay for this.  But your company withholding money that is rightfully MINE (NOT YOURS TO COLLECT INTEREST ON FOR 21 DAYS), well this is starting to sound like securities fraud. 

I have no reason to have been put into the catagory of "high risk."  I would like to receive the money that my customer paid, BEFORE this phone leaves my hands.  It is a $200. item and I am not willing to part with it until I know that the money is acually MINE!!! 

[Carlonchook]

There's no name for what payPal is doing....wait there is: is called greed!!!!! Theres nothing we can do about it just blwo some steam here, but, maybe theres something better to do: I'm advising the buyers to leave possitive message as soon as they open the door for the mailman or else Iwill leave a negative feedback to them for lining up with Paypal to steal our money...So Buyer be awared YOU MUST FIGHT THE THIEVES OR BE ONE OF THEM!!!!!

[offroadrick]

Dear Paypal, (just to see if you read these)

I just sold an item that gave the choice of pickup or shipping. The individual after being charged shipping decided to pick it up. Fine I agreed to give him his money back for shipping when he picks it up, but he doesn't want to pick it up for 2 weeks. Now my funds will be held until he gets back with the item and gets around to providing feedback. In the meantime I will have already given him $20  out of my pocket and my items I've sold without recieving anything in return. How could this seem fair? Even the IRS will pay you interest on the money they hold once it is released. Will you be paying us interest?

[shanimax7]

I totally understand where you are coming from . Papal is starting to **bleep** more and more since Ebay took it over ,

As far as tracking ALWAYS SEND DElIVERY CONFIRMATION !!! You can print a label on  papal Free and delivery confirmation is only 19 cents vs. 80 cents @ the post office .

[reynolds]

---

@socrcoach17 wrote:

I would like to hear from someone at PayPal the answers to several specific questions relating to the pending payment policy. I have read the various threads on this, and the relevant section of the Terms of Service Agreement, but these are questions not answered elsewhere.

FIrst, the background. Like so many others here, I was caught by surprise when payment was held up for an item I sold on eBay. The item sold for $455 and because it is heavy and bulky, the shipping charge was $225 (in the actual fact, it cost me more than that amount to pack and ship and I ate the difference). The winning bidder paid immediately via PayPal. PayPal immediately marked this as a "pending" payment. The item was shipped less than 48 hours after the auction closed and delivered yesterday. I supplied the tracking information to PayPal/eBay as instructed. The payment still shows simply as "pending" and when I click on "Details" I am told that status applies for another 14 days, OR 3 days after PayPal can determine that the item was delivered, OR 3 days after the buyer leaves positive feedback.

There is no way for me to verify that PayPal/eBay knows now that the item was, in fact, delivered yesterday. There is no way to know when and if a change in pending status has occurred. The policy is ambiguous as to whether delivery even matters for an eBay auction item, or if only positive buyer feedback will release the funds in less than 21 days.

QUESTION 1: If the item was sold pursuant to an eBay auction, is the pending status changed when the SOONER OF or LATER OF the two listed events occur: provable delivery or positive buyer feedback? How can I verify that PayPal now knows the item was delivered and, therefore, that the 3-day clock has started to count down?

PayPal positions itself as the most convenient way for a seller to accept payments, especially on eBay transactions. I was charged a $20+ fee for this transaction. I had to front the $225 shipping charge. I now have to wait an arbitrary amount of time for payment, with no feedback from PayPal as to status before or after the buyer submitted his PayPal payment transaction. In the very best case, the funds will hit my bank account two weeks from when the auction closed because of the holiday weekend.

QUESTION 2: Why is this good for me as a seller? You are charging me premium transaction fees, what service am I AS A SELLER getting in return for this policy and the fees charged?

The most basic tenet of contract law is that the parties have to agree to the terms in order for there to be a contract. PayPal's Terms of Service Agreement relating to pending payments is hopelessly vague, to the degree that I question that it constitutes a contract. It would not be a valid contract for me to say, for example, "I can do whatever I want for any reason" and for you to agree, and for me to then take your car and your house. I could argue that your agreement was stupidity on your part (which is, essentially, PayPal's response to sellers in the various threads and is vaguely insulting), but I could not defend such capricious actions in court based on that "contract." Particularly in a dependent situation like this

The PayPal pending payment policy does not, for example, let me know, as a seller, whether I or any given transaction are subject to being pended, what I can do to prevent it, or what specific criteria PayPal will use. PayPal relies on terms like "high risk" that clearly mean something very different to the sellers who have spoken out in this forum than they mean to PayPal. In no way would I, as a reasonable seller, read the text of the TOSA and interpret it as meaning what PayPal is, in fact, doing. You are doing things that are not reasonable interpretations that a reasonable seller would be expected to conclude are consistent with the TOSA's language. They appear to be arbitrary and capricious and unrelated to the stated policy.

In short, a seller "agreeing" to the TOSA can have no basis for understanding what it now turns out PayPal means by those words.

QUESTION 3: How does the TOSA, regarding pending payment holds, constitute a valid contract, given that you provide no way for the seller to know what he/she is agreeing to and that reasonable sellers clearly think you are interpreting this language in ways opposite to the way they understand it?

Given that PayPal relies on its "sole discretion," there is an implied obligation for the policy and its enforcement to rationally relate to its purpose.

As with so many others, there is no evidence in my case of any kind of a problem. This was a personal sale, but I own a company that accepts credit cards based in large part on my own credit history, and have had no problem with approvals for those transactions from banks, or any problems with any specific transactions. There is no history of complaints against me personally or my company, I have no criminal history, no financial fraud, solid credit rating, bank account has been verified. In other words, PayPal has reached a decision about my "risk" that is opposite what other financial institutions that provide similar services have concluded.

QUESTION 4: How does the pending payment discretion policy of PayPal rationally relate to actual risks to buyers, its putative purpose? What does the term "high likelihood" mean anyway - 50%? 10%? 1%? What statistical evidence does PayPal have that the criteria used are predictive of a "high likelihood" (whatever that means) of buyer dissatisfaction? Is there any such evidence at all that eBay frequency is a reliable predictor, or is this just someone's guess?

Clearly, this policy benefits PayPal financially. You get the benefit of interest on the funds while they are in pending status. It is like travellers checks - the financial institution makes money on the float. Therefore, PayPal has set itself up with a clear conflict of interest, between fairly interpreting ambiguous or discretionary sections of the TOSA, e.g., what constitutes "risk" to buyers, and what is financially beneficial for PayPal.

QUESTION 5: Will PayPal remove this conflict by paying interest on the funds held? If not, how can you claim to not have an egregious conflict of interest in your unilateral interpretation of the TOSA?

---

[pebbles]

Then you have to wait 3-4 business days for PayPal to transfer ( only at your request  f course ) the amount to your bank account.