PayPal makes important changes to Policies effective June / July 2009

Posted on May 2, 2009. Filed under: Paypal | Tags: , , , , |

There are several new PayPal policy updates that were announced today.

(1) Effective June 3, 2009 you may not use PayPal service for activities that “involve the sales of products or services identified by government agencies to have a high likelihood of being fraudulent”.  Not sure what that means?  Neither am I and neither is the PayPal representative I spoke with today.  PayPal informed me that they cannot answer any questions about policy updates unless they are submitted by email.  So, if you want some details you will have to email PayPal.

(2) Personal PayPal accounts, where all payments except those funded by credit card, are free for the receiver.  However, beginning June 3, 2009, personal PayPal accounts will no longer going to be available for use by anyone who sales goods or services no matter the amount.  If you sell a $1 item then you must convert your personal PayPal account to a commercial account and pay fees on all transactions no matter the funding source used.  This is a major change and many very small or part-time online sellers won’t see this one coming.

(3) Beginning July 1, 2009, PayPal Preferred Rewards (Cash Back) for debit card purchases will be paid out at the end of each calendar month rather than after each transaction.  It looks like PayPal wants to hang on to your money just a little bit longer.

(4) Pilot program that will change your default payment sources beginning June 8, 2009 (quoted from policy updates):

Some PayPal users will receive an email from PayPal informing them that they have been selected to participate in a pilot program that will change their default payment sources for a 12 month period. If you are selected to participate in this pilot, your default payment sources will be changed as follows:

  1. Not “required” to use your Balance when sending a payment. Right now, if you have a Balance in your PayPal Account, you are required to either withdraw your Balance, or use it to fund your payment. If you are entered into this pilot, you will have the option of changing your payment source at the time you make a payment even if you have a Balance.
  2. Bank before Balance. Right now, if you have a Balance in your PayPal Account, you are required to either withdraw your Balance, or use it to fund your payment. If you are entered into this pilot, you will make payments from your bank account instead of your Balance. In addition, you will have the option of changing your payment source at the time you make a payment even if you have a Balance.
  3. Credit Card before Balance. Right now, if you have a Balance in your PayPal Account, you are required to either withdraw your Balance, or use it to fund your payment. If you are entered into this pilot, you will make payments from your credit card instead of your Balance. In addition, you will have the option of changing your payment source at the time you make a payment even if you have a Balance.

Be sure to log in to your PayPal account and review all the Policy updates.

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17 Responses to “PayPal makes important changes to Policies effective June / July 2009”

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I see Paypal has adopted eBay’s attitude of regarding their entire customer base as guinea pigs for beta tests, without bothering with niceties like consent. Who cares if the change is good for the customer? Only the company’s welfare counts. UFB.

Let’s keep abreast of Amazon Payments.

Wow! Thanks for this article. It seems that PayPal has decided that since I no longer sell on eBay, that they don’t need to notify me of payments or news!

Had an Ebay Store for some years. Used to be pretty good business. Not any more so I shut it down and left FeeBay early last year. And…

Well, I am so happy that I have never used PayPal and don’t plan to ever use them. Their track record does not give me trust.

Interesting – every one of the changes – including and especially the pilot program are designed specifically to help Paypal either make more money (the change in the personal accounts) directly, or to hang on to user’s money for longer periods so they can earn more investment income! Not one of these changes is sourced in a desire to improve their services or to offer more benefits to their customers in even the tiniest of ways!

I’m going to make a prediction: Just before the start of the big holiday shopping season, they will (again)quietly post a “change in policy” notice to end their rewards program entirely.

More reasons to leave Pay Pal and close the account at my bank associated with Pay Pal.

I’ve been one of their last defenders, but it appears that they ARE trying to operate as an unregulated, unsecured bank and hold onto funds longer for their own benefit.

What most people don’t understand is that there is little recourse if Pay Pal decides to hold the money and never release it — other than suing them. Not worth the risk, IMO.

Also what government agency is in charge of determining what sales or services are likely to be fraudulent? None. Never heard of such bullshit before.

Looks like Donawhore, not happy with ruining ebay, is now going to do the same to Pay Pal.

Great job, Donawhore. You’re being the most reviled business man in the history of US commerce.

Interesting – the switch to Bank before balance will cause a lot of echeques – they take longer to clear (which will cause eBay DSR damage) but they do have the advantage of a fees cap somewhere around the $100 payment mark. I haven’t checked if that cap is to be removed – must do so.

The switch to cards before balance is of course a direct fee grab, and designed to shift payment insurance liability from PayPal to the card issuer. At a PayPal level they will simply refund the card issuer from the seller account or attached bank account. Must check if they have twiddled with the fees refund element of such events.

The “no goods sales” element of the personal account, to be honest, I’ve been waiting for. The purpose and use of personal payments has been heavily abused by users – I’ve even had eBay buyers email me for a discount if they send me a PayPal Personal Payment, as there’d be no fees from PayPal – not realising that it’s the status of the receiver’s account, not the payment, that decides if fees apply or not. Had my “comms” DSR dinged a few times on that one too.

I do not like there is no opt-in / opt-out discussed on this announcement. In most EU countries, that will certainly make it illegal – I must do a hard compare of the UK and US announcements to find the differences.

Gaz

Glad i’m quitting the PAY THROUGH THE NOSE Pal habit before then!

We have been selling on ebay for over 10 years now. Selling on ebay is like gambling. Dont list ANYTHING you are not willing to lose! You never know where a transaction will take you. Up or down. We have sold items from .99 cents to $24000.00. I have decided its not worth listing anything worth more than $20.00. Not worth the risk! Ebay is a great marketing tool. Although it may have proced itself out of that market as well. We will see…

Everyone, especially sellers should consider using Revolution Money Exchange now, instead of PayPal. Most of the auction sellers I know now use it and so far it’s been just fine.

Have a look at this link. It is my referral link: https://www.revolutionmoneyexchange.com/ReferAFriend/ReferAFriend_landing.aspx?referreremail=buzzard_flats@yahoo.com

You are welcomed to try it out, or not. Just getting the word out.

Using PayPal has always made me nervous, especially when they freeze accounts. It’s just gets worse as time goes on. I’m looking into Revolution Money Exchange.

Now hang on a minute. Where is Bill Me Later in all this. Why can’t I simply be a BML-only seller? Isn’t that what ebay bought them for- to fend off antitrust accusations? Well then, let’s Road Test that mother!

[…] so if that is confusing to you, here is a site that explains these changes in more detail. Damn, could Paypal/eBay get any greedier? I use Paypal a lot for personal transactions, I might […]

Forget paypal. Use RME instead. I never had a problem with RME yet.

This explains why I suffered money deductions last month on my personal account. This is nothing but bs

Paypal is just becoming a money-sucker. People help out with alternatives otherwise small time freelancers like me will have a lot to suffer! Hows RME?


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