Having solid TOS in place is required for proper business, and protects you with any merchant account. The part of funds now that is no longer available when the program ends is the financial protection it provided in the event of either a Paypal disupute or a Chargeback. During either one of those situations, the money would not be pulled from your operating account during the dispute. This is different from all other merchant accounts. All other merchant accounts will immediately remove the money from the account that they make deposits in, and they keep it through the duration of the dispute. No a big problem is we're talking small transactions, but say you have a 10k sale, that changes everything. Take the following example to heart: I sell a product online at retail 10k, have a modest 20% markup on that item, so profit is 2k. Item is delivered to customer, I then replace that item for stock, at cost of 8k, to do it again. A chargeback is filed on the item you sold for 10k for any number of reasons. A traditional processor will then remove the 10k from your account while the dispute is open. You lose 10k worth of operating capital for around 90-days, and the further insult is you've also invested another 8k in replacement product. Now how was that 2k profit sounding now? Not good. Without a tool like Funds Now, you have to take the risk with your operating capital, decide on how much risk you are willing to take. For the more expensive items, you have to use traditional payments, like cash, check, wire, ach. Not every customer can afford to make a large purchase at once, and may need the credit card, which helps you sell now as well. I actually structured two e-commerce web-pages that I'm using to Paypal exclusively with for processing (Payments Pro and regular Paypal) and enabled products to allow full purchase of items up to 30k in value. With this program ending, I have to restructure all large ticket items back to how I operated with the traditional merchant account. Limiting sales to 5k and below a card is possible, and beyond manual payment method only. Due to Paypal's removing of this program without a proper replacement (even at a fee, which I would be glad to pay for the protection) we will be removing Paypal completely as the processor and no longer accepting Paypal alternatively either. This change will sharply be executed at the end of this FY. I will go back to Auth.net I also had extensive issues with Paypal buttons on another website I operate, that system is falling apart and Paypal has labeled it Legacy, and I can tell you they don't provide any fix support for issues you uncover any more. So it'll be replaced with an e-commerce website by the end of the year. It very much appears that Paypal's usefulness has ended and I can't see how they are going to be sustainable.
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