The Keys to Surviving the PayPal 21-Day Hold Policy

Posted on November 15, 2008. Filed under: eBay, Paypal, Tips - for the eBay Seller | Tags: , , , , |


The “21 Day Hold Paypal Policy” has created a great deal of frustration for many eBay sellers.  Below I have some recommendations for eBay sellers who are looking to ease the pain of this new policy:
1. Become informed
By knowing when PayPal is most likely to hold your money and what it takes to get the money released, you can better prepare the hold and react more quickly to get the funds released. 
To read about the details of the PayPal 21-Day Hold Policy for Seller, be sure to click HERE
2. 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%.
3. Understand that sometimes you cannot prevent the 21-Day Hold
If you are a seller listing your item in a high-risk category such as gift certificates, video games, cell phones, computers or consumer electronics then you are subject to the 21-Day Hold simply because of the type of product you sell.
4. Do not offer international shipments if you are subjected to the 21-Day Hold
Unless your international buyers will pay express mail shipping costs willingly, it is not in your best interest to offer international shipping options.  International shipments take longer to arrive than U.S. destinations and it is more difficult to confirm delivery thus taking even longer for your funds to be released by PayPal.  Instead, sell domestically only while you work toward meeting the requirements to prevent the PayPal holds (see number 2 above).  When you are not automatically subjected to the PayPal hold then you can once again consider selling internationally.
5. Do not contact the buyer specifically for feedback to get the funds released
PayPal funds are released from the hold if the buyer leaves positive feedback.  While you would hope that the buyer would leave feedback immediately upon receipt of the item, that does not always happen.  Contacting the buyer to inform them that PayPal will not release your funds until they leave positive feedback puts the buyer in an awkward situation, gives them undue influence over the transaction, and gives an unfavorable impression of you and your business.  So, your pleading with the buyer to leave feedback could actually cause the buyer to leave unfavorable DSR ratings with their positive rating if they feel unduly pressured or it could cause the buyer not to leave feedback at all when they otherwise would have done so automatically.  Instead of asking the buyer to leave feedback to have your funds released, consider another alternative (see number 6 below).
6. Ship all items with delivery confirmation (postal) or tracking (UPS/Fedex) to a valid address
Be sure to use delivery confirmation if you ship by postal and keep a record of the delivery confirmation number or the tracking number if you ship by UPS or FedEx.  If the item is a high-value item, be sure to require signature confirmation.  And always let the buyer know in advance the method by which you ship an item, especially if by a method other than postal.  Some buyers may have had problems with a particular delivery service and they might tell you in advance if FedEx seems to never be able to locate their address, for example.  Again, your goal is to get the item to the buyer as quickly as possible.  Once the item has been delivered to the buyer, give PayPal the delivery confirmation number or tracking number.  The PayPal funds will then be released to you approximately 3 days after the package has been delivered.
Also, it is important to note that you MUST ship to the address supplied by PayPal not an alternative address that the buyer might provide in the PayPal notes or in a separate email.  And if you attempt to run a shipping label and the carrier notifies that the address appears to be invalid, do NOT ship but immediately contact the buyer to work out the issue before shipping.  If you need to, request the buyer’s phone number from eBay and give them a call.  Again, it is best not to mention the PayPal 21-Day hold issue. 
If you fail to provide the delivery confirmation or tracking number to PayPal and the buyer does not leave positive feedback, then you will not receive your held funds until 3 weeks after the payment was made.
7. Be professional and calm with all dealings with PayPal personnel
PayPal employees cannot change the 21-Day Hold policy and they cannot get your funds released any more quickly than what the rules state.  Therefore, no amount of pleading for leniency or for an exception, no amount of complaining about the policy or threatening PayPal customer service agents will help you.  Instead, provide the shipping information that is necessary to get your funds released in a timely manner.  Be diligent and persistent in your efforts but always remain professional and calm.  Place your call to PayPal when you have had a few minutes to sit down and relax first and call at a time when you are not rushed. 
The goal is to get your PayPal funds released as quickly as possible with the least amount of effort and stress while, at the same time, working toward preventing the funds from being held anymore in the future.

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41 Responses to “The Keys to Surviving the PayPal 21-Day Hold Policy”

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You can also add Tracking Numbers to Paypal transaction page for high dollar items to have your funds released sooner. There are few things you have in control, but communicating tracking numbers is one of them.

Good tips, as usual.

[…] recent post: “The Keys To Surviving The PayPal 21-Day Hold Policy” on the Brews News, details all of the ways a seller will be subject to the 21 day payment hold policy when accepting […]

As a merchant, I would NEVER ship an expensive item without having cleared funds. Ebay gives NO notice at the time of selling that this could happen if using paypal; instead they let a seller get a rude surprise after getting payment to learn about this policy. As it is insane to ship an item without knowing if the funds are good or not, and also insane to trust Paypal to release your funds as they outline, since they have a long reputation of freezing funds beyond what they state, the best thing is to completely avoid using paypal for your first 25 transactions in a year, and only then use them IF you have positive feedback and meet the other criteria. But in reality, it is best to completely avoid them, and instead have a buyer pay you directly with a moneyorder or check, or use google checkout for credit card payments. I used to not like google checkout, but now they are looking good as an alternative to accepting paypal payments on ebay. I have a merchant account, so I will use that, but for those who sell infrequently, just to clean out their garages, or make some side money, beware. Use google checkout or have your buyers pay you directly. This whole setup screws the seller and only really protects paypal. If paypal really cared about protecting the seller, they would not urge the seller to quickly ship out their item without having confidence the money was cleared. Instead ebay would set it up so that all buyers would know they have to wait 21 days before their items are shipped, just like paying with a check, so paypal and the seller know the funds are good. Anything else is an insane way to do business as a seller. Do you think Walmart is going to ship out online orders, letting paypal hold their money for 21 days? I don’t think so.

This PayPal 21 day hold is WAY OFF BASE!!!!
PayPal tells you NOT to ship until you have received cleared funds!!!!!
This is just another way for GREEDBAY to make more money at your expense!!!! They hold the funds in theri bank account earniong interest while tou are expected to ship and get feedback in order to get your money?????
That’s not the way retail sales work!!!!! Why should sellers have to wait for their money?????
On top of that, the PayPal 100% buyer protection is NOT 100%!!!!! It depends on whether or not they can take money from the seller’s account. I won an item for $200 including shipping, paid with PayPal. Never got the item as it was destroyed in shipping and insurance claim was denied due to seller fraud. Seller refused to refund my money so I had to file the claim with PayPal. After over 2 MONTHS I finally got a partial refund of only $150!!!! 75%, NOT 100%!!!!!

McDonough, GA 30252


To: Office of the Attorney General State of California

Re: Paypal account “”

cc: Federal Trade Commission, Office of the Attorney general state of Nebraska, Complaint Assistance Unit of the Division of Consumer Services of the Department of Consumer Affairs, Better Business Bureau, American Express, Chase, FBI Fraud Unit, Paypal

Dear Madam/Sirs,

We are submitting this complaint to compel you to renew your investigation of Paypal for ongoing fraudulent activity and to seek regulation of this financial entity to the accountability and rule of United States law.

Our story is a shocking symptom of the problem at hand. Paypal is withholding $33,306.86 that was successfully reversed to our Paypal account on November 7, 2008 without claims or disputes by any other party. Paypal initially declined to approve the transaction that became reversed, and no money changed hands between buyer and seller. The buyer made alternative payment arrangements with the seller because Paypal also failed to deliver the payment venue with the ease its advertising promises. Although no claim or dispute by the seller has been placed on the amount in over 30 days, Paypal continues to hold our $33,306.86 without offering any reason or date of resolution after repeated phone calls.

This presents numerous problems for which we think Paypal should be investigated and regulated. This pattern of milling and holding legitimate charges from honest customers on a large scale, in an imperious manner, is self-evident to anyone who investigates the volume of Paypal complaints. Whether this pattern is suggestive of secondary gain or whether its just bad business service is the real concern at hand for the US government. If the former is true and Paypal wishes to fund their own investment strategies with customer money, then customers at least need a Prospectus for full disclosure prior to that money being used elsewhere as “capital” to Paypal. If the latter is true then customers will still need some sort of consumer protection from mayhem the likes which we are experiencing. Paypal must not be allowed to continue to advertise “ease of use” while ensnaring customers in charge back schemes and debacles for which there is no accountability to a third party. As such Paypal is a threat to many businesses who find their cash flow suddenly impeded by questionable Paypal decisions for which their is no governing authority to mediate. In many cases businesses are financially damaged by such undesired mismanagement.

To this date, we still have not received our own money returned to us. Nor was a purchase completed. And, our credit lines continue to be inaccessible while Paypal holds the funds.

We will readily submit any necessary evidential documentation at your request.


this is definitely ridiculous. i have not used ebay in quite some time but decided to sell my wedding dress and ebay was the best route to go. i sold it for $250 and since i have less than 100 feedback (i hardly use ebay) i found out AFTER the buyer paid that i would have to wait 21 days to get my money. they should release all this info up front. (which i’m sure they do in the terms of agreement but to be completely honest, who ever reads those things?) anyway, i am getting delivery confirmation through usps so that i can get my money sooner. but i am still, inside, worried that they will hold my money for some reason. it’s just not right.

This is a tactic to put money into their [paypal’s]Bank and gain interest on it for 21 days. America is in a financial crisis, like $500 + Trillion of derivities debt and 3 leading banks combined liquid assets are 1.7 Trillion. Time to take alternate steps to secure our money transactions.

Paypal is currently holding my money for 21 days and the wait is truly grueling. The a-hole I sold my item to won’t leave me any feedback and even though a paypal rep told me I could have access to my money after 3 days of a confirmed delivery, 5 days later, MY MONEY is still “pending”.

I got my funds released when I asked for a supervisor and now I have reported them to Better Business Bureau

I sold several computer items on Ebay before I learned of the Paypal 21 day hold, and 8 weeks later I still have not received my money. Calling Paypal/Ebay is about the biggest waste of time ever. BUT LADIES AND GENTLEMEN, I FOUND A LOOPHOLE!”

Anyone and everyone can sell on Ebay without worrying about Paypal holding your funds anymore. I have even opened an ebay store and it’s doing quiet well. The secret? Ebay was forced to allow other merchants besides Paypal and I switched to Moneybookers! I am selling well on Ebay and no matter what the item is I get my funds instantly!! All sellers should drop Paypal and switch to Moneybookers and re-level the Ebay playing field! Spread the word…

I just had a transaction with paypal and they placed a hold on the transaction. I promptly notified the buyer that I am really sorry but I will not send out an expensive computer processor that could be destroyed and disputed while not being paid. I called paypal and they agreed with me but would not do anything for me. I promptly refunded the buyers money (within 30 minutes) and listed it on craigslist. If it does not sell then I guess I will build myself another computer. I repeat will not send out a product without cleared funds available to me. EOM.

I believe this policy is unfair to the seller as well. What is to stop the buyer from destroying it within 21 days and then scamming us (the sellers) or what is stopping them from sending fake photos of a damage version of that product they found on google.

I don’t see CHARGEBACK in that there entire survival guide.

Michel, that is because a chargeback is a completely different topic from the 21-Day Hold issue.

The ideas stated above are legitimate ways to deal with the inconvenient hold now placed on by eBay.

[…] 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 […]

Who do you work for? Paypal?

Kevin, I work for myself. I am an ecommerce seller.

I used to use eBay 100% of the time when selling items.
Thanks to their continued and escalating abuse of sellers, that total is down to about 20%.
I only use eBay when I can’t sell on Craigslist, my first choice.
I use Craigslist a majority of the time.
I believe this is why eBay/Paypal have taken to stealing customer’s money in an attempt to make up for lost revenue.

Keeping customer funds and collecting interest is stealing. Any interest gained from my money is also MY money, not Paypal’s.
How the US Government has refused to intervene on the behave of Americans on this issue is beyond my comprehension.

Again, Paypal needs to pay their customers their due interest gained on money’s held by Paypal.

I didnt know paypal would hold my funds for 21 days either. They do not specify this before you sale. I have already shipped the item, wished I would have just refunded the money to the buyer and sold elsewhere. The one thing that really makes me mad is Paypal makes sure they take out their fees after the sale. Then, on top of all of that, you may be out more money because if something falls through and you end up not getting the money for some reason, you had to spend more money out of your pocket to ship the item since you couldn’t get any money from paypal to ship it. So, out the sale price + shipping. Shouldn’t this be illegal for paypal to do??


Got the same email (1/18). My account is well above the numbers given in the paypal policy.
Paypal and Ebay customer service could not explain it.
Ebay lady told me to forward emil to
Will se what happens whith the next sale.

The reason is so they can collect interest on millions of dollars of “HELD” funds for 21 days to make more money

you are right on !

have you had the 21 day hold lifted>

Fix your eyes on the dangling pendulum.

You WILL ship your item ahead of payment.
You WILL submit your credit info to our ‘partners’
You WILL give your item away should we deem it appropriate.
You WILL refrain from contacting the Federal Trade Commission about these and other abuses.

It must be working. Amazing that the FTC deems College Football a monopoly nut won’t touch Ebay/PayPal with a 10-foot pole.

Mizz Bartz… Yahoo Auctions… where ARE you!!!

This crap should be illegal. It is MY money, not theirs and they should have no authority to hold MY money, they are not a bank, or the Government. I think a class action is in order.

PayPal held my funds because of a sudden “spike” in sales. I think that’s aweful because eBay use to be a place one could liquidate stock; now it’s just a warehouse of standard junk.

Is this only on eBay sales?

If so I will contact all my past eBay customers who LOVE my OOAK design work and direct them to my website whenever I am overstocked and I will sell at 75% off.

I don’t think my customers would purposely take advantage of me. I know that sounds naive but they can’t get what I sell anywhere else. Therefore, I do send out “pleads for feedback”. One of my customers even sent feedback before they received their jacket.

However, I don’t send 1st class int’l anymore because I did recently get burnt. Maybe it is the P.O. in Canada, but PayPal could see that it was shipped via the customs number, but that doesn’t prove the buyer received it, so either way, USPS 1st class isn’t reliable enough, which means the buyer pay more for shipping.

The way I see it, is this is a way for eBay to get rid of sellers they don’t want without being accused of discrimination.

They no longer want to be a place where unusual and unique things are sold but rather a place where bar code / skew items are sold; more like a surplus warehouse store.

They are doing a great job because they are getting rid of me; one who sells OOAK women’s handmade apparel. I have boycott eBay for buying unless I have to because I can’t find the iten locally, but that’s it!

I sold several items with a new ebay and paypal account, all for less than $5. each, and paypal put the 21 day hold on me. I stopped using ebay about 5 years ago after my divorce, and i needed a new account and a new payupal account to sell on ebay. I complained to a supervisor at Paypal, and I received an email stating that, from now on, ALL of my payments will be held for 21 days. Since they are not a bank or a financial institution, I highly doubt it is illegal – that is how they get by with it. I will use Moneybookers, but if you have a problem with them, be aware they are based outside of the US, and the same laws do not apply to them. I had a person stiff me for $1500 through google checkout, so I don’t use them any longer. I guess my last option is my own merchant account, but I hate those damn fees! Any other suggestions?

what company are you using to process credit cards?

I design and make Marie Antoinette gowns and colonial dresses. I am closing my store after 12 yrs on eBay. the 21 day hold was placed on my account it torpedoed me, there reason for holding it to refund if customer is dissatisfied….is ridiculous! I have 100% feedback.
I think you are right about the bar code ect…have you found another shopping sight to put your dresses on?

I sell on Etsy… Have done very little Ebay… was a preferred seller and power seller but Etsy has come along way since I first started with them in 2008.


A seller would have to be rich or crazy to ship any item for which funds have not cleared. Ebay and Paypal have given the green light to thieves, and that they will help facilitate any theft someone wants to perpetrate on sellers.

.Their greed men and women who are out of touch with the human side.they really don’t care who get’s hurt it’s the bottom line they care about, sure they love you when their small now they hate you because their apptite is much biger and your not working hard enough to feed it they will in time fall if they don’t change, they must fall in order to change.theirs no reason for a person with a good record to have funds held it’s your money they make out like their the good guy’s only trying to help, bul shit and you know it 1000 times over.sorry but that’s what it look’s like to me.

Woves in sheep’s clothing they love us so much, and the cow jumped over the moon folk’s it’s the bottom line they care about. a great comany cares about it’s people and build’s a thrust with them .few exist any more now many company’s make moves that benafit them ,were an after thought but o do they kiss ass when there smal or they fall.

I am a 100% seller. with a blue star. not new to ebay and they have done the 21 day hold. not a single dispute or neg comment ever. I am so angry. I am not going to be using them if i can avoid it.

I just found out about the 21 hold policy the hard way, by surprise.

It seems to me that whose money is being held is a matter of who still has the item. My auctions already say that I will hold an item for 10 days if payment is made by check, to make sure the funds clear. Now my auctions will say that I’ll hold payments made by paypal until the funds clear. The buyer will be informed that if they use paypal, paypal might hold THEIR money for 21 days or longer, but that I will ship as soon as THEIR funds clear just as I would for payment made by check.

I will suggest that they pay by money order or some other means such as Moneybookers, if that system is still available.

Now let Ebay and paypal deal with the FACT that they are holding the BUYERS money.

my business relies on the money my customers pay me to make a special order. I buy material and build custom dresses. I am a professional. I cannot operate without my working capitol. for pay pal to hold my money for 21 days or in-till shipment delivery confirmation has put me out of business . I have been on ebay/payapl for over 12 yrs! with 100% feedback!
they are holding it because if someone wants a refund . which has not been a problem for me . they assessed that my business is a high risk business .

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