PayPal Glitch or Advance Warning of a New Random Holds Policy?

Posted on September 6, 2009. Filed under: eBay, Paypal | Tags: eBay customer service, eBay seller frustration, Paypal 21 day hold, Paypal hold glitch, Paypal holding funds in error |

Last November, I wrote a blog article titled “The Keys to Surviving the PayPal 21 Day Hold Policy” (click HERE for that article). In that article, I stated that one way to survive the PayPal 21 Day Hold is simply to prevent it in the first place:

Prevent the 21-Day hold to the extent that you can

In all cases, your buyer satisfaction rating must be greater than 95%. A dissatisfied buyer is one who (a) leaves negative or neutral feedback or (b) files a PayPal dispute / seller non-performance dispute or (c) leaves a 1 or 2 star rating in any of the detailed seller ratings categories. More than 5% buyer dissatisfaction automatically subjects you to the PayPal 21-day hold.

Other than having a buyer satisfaction rating greater than 95% you also either have to

(a) have been an eBay member for more than 6 months and you have 100 feedback or more, or

(b) you will need to have received 20 or more detailed seller ratings in the last 12 months.

eBay sellers who are relatively new (less than 100 feedback or member less than 6 months) or who have had little activity in the last year (fewer than 20 DSRs in the last 12 months) are, therefore, automatically subjected to the PayPal 21-Day hold even if their buyer satisfaction rating is greater than 95%.

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

The following comes DIRECTLY from the PayPal website (click HERE to read the policy. Note that you do NOT have to be signed into PayPal to view this page).

Why would PayPal hold one of my payments?

To increase marketplace safety, we may hold payments that seem risky. Here are some common reasons for holding payments:

You have been an eBay member for less than 6 months, and you sell an item for more than $100, or
You have an eBay feedback score of less than 100, and you sell an item for more than $100, or
You have a Buyer dissatisfaction percentage^**5% or greater than 5%, or
You have an average Detailed Seller Rating (DSR) of less than 4.5, or
You have received fewer than 20 Detailed Seller Ratings in the last 12 months, or
You are listing your item in a high-risk category such as gift certificates, video games, cell phones, computers or consumer electronics.

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

So, an experienced eBay seller with great feedback and DSR ratings and who doesn’t sell in a high risk category such as video games or electronics would expect to be exempt from the PayPal 21-day hold policy since they have done everything to prevent the hold. However, over the past few days, several sellers with outstanding feedback (many with 100% ratings and 4.8 or higher DSRs) and who do not sell in high risk categories have reported that they have been subject to the PayPal hold policy.

Paypal Community Board:

PayPal Holding Funds

Seller Central Community Board:

eBay & PayPal hold funds ERRONEOUSLY – No customer support

Random Paypal Hold? 100% fb 10000+ fb hi dsr’s, was told it was random

And on the eBay Powerseller Community Board, there are quite the discussions occurring about this issue.

From all the various threads on the eBay boards, it seems that there is a “glitch” which is causing many sellers to experience the PayPal hold in error. Unfortunately, sellers who are calling eBay are told to call PayPal and sellers calling PayPal are told that the holds are due to eBay’s decisions and that they should call eBay. Callers to eBay customer service are being told a variety of different things ranging from “it’s a glitch” to “it’s a new random hold policy”. Some sellers are able to get the holds immediately removed with just a phone call and others are not.

Because there is no official notification on either the eBay or PayPal system announcement boards or blogs, sellers can only speculate. It would appear from all indications to be a eBay/PayPal glitch but I have no confirmation of that.

One eBay seller who experienced this “presumed glitch” first hand is Rob from GuitarAudio who has graciously allowed me to use his screenshot and to tell his story.

Rob says “I have seen instances where PayPal does the 24-hour review on occasional payments, but this is the first time I’ve seen something like this”

About 48 hours after Rob first posted on the eBay Powerseller Community Bulletin Board, he followed up with:

“I didn’t talk to PayPal yet, but they randomly released the hold. I guess it was a glitch. Also, I do sell on the river. I’m okay with their system, but it does tie up cash flow when they’re holding $15,000.00 for 2 weeks.”

Other eBay sellers are reporting that their “glitch” holds are also being released without any action on their part. While I find the PayPal glitch issue to be a problem, I think it is more of a problem that eBay sellers who call customer service are being told a wide variety of different things and that there is no public announcement from eBay or Paypal to let users know what is happening.

From past history, eBay and PayPal “glitches” such as these are often signs of things to come, advance warnings if you will of new policies that eBay Inc. is getting ready to enact. Could it be that the ”random PayPal holds” policy, mentionned by several different eBay representataives, is coming soon? Remember that PayPal has never committed to give users any advance notice of new policies so just because a “random PayPal holds policy” has not been announced doesn’t mean we won’t see it enacted immediately or sometime in the near future.

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

NOTE: Special thanks to Rob from GuitarAudio for giving me permission to use his screenshot and to tell his story.

You can find Rob online at his website GuitarAudio (www.GuitarAudio.com) or on eBay by clicking HERE.

My son just started guitar lessons to learn to play an accoustic guitar and when the time comes for my son to get an electric guitar, I know a great place to look online now. Thanks again Rob for letting me use your screenshot and tell your story!