After having spent literally an hour on the phone with four (polite, professional, helpful) PP tech support persons, I now have the explanation and solution for anyone else who does not have Pay from PayPal Balance as an option in either their Wallet or in Account Settings/Payment/Online. If you do not have this option available to you, call PP support on the phone and say the following:
"My PayPal account was created before the Patriot Act law was passed. I need to get my account verified so that Pay from PP Balance can be enabled."
If the support person does not know what this means, please explain the following:
When the Patriot Act was passed, it required PP (among others) to verify the source or identity of an account holder, presumably because PP did not want to be liable for facilitating funds transfers for terrorists. Therefore, whenever a new PP account is created, some identity verification is needed. And this is where PP dropped the ball: If your account was created before the Patriot Act was passed, your account was grandfathered, so you never had to provide verification information. However, PP NEVER COMMUNICATED this information to account holders with these limited grandfathered accounts in a way that was easily discovered (such as in the Wallet area).
Consequently, even though the PP documentation says specifically that purchases will draw from PP balance first by default and then Preferred Payment if not sufficiently funded, that is not what actually happens to an unverified grandfathered PP account. If you have an unverified grandfathered account, you ASSUME that it is drawing from your PP balance, but it is not – it is drawing from your Preferred account ALWAYS. Thus, the purchase interface fakes you out into thinking that the request for the selection of a preferred payment amount is only asking you as a backup. It is not.
If Pay from PayPal balance was an option, it would show it to you. If it doesn't, you need to have it manually activated by PP support. Until you make this phone call to PP, it will not show Pay from PayPal Balance.
You may now get on with your lives. :-)
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