Desperate Seller Describes PayPal Nightmare

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AuctionBytes Blog
News and insight focusing on
ecommerce and the online auction industry
by Ina Steiner, Editor of AuctionBytes.com

February 13, 2008

Desperate Seller Describes PayPal Nightmare

By: Ina Steiner

Wed Feb 13 2008 12:36:25

A seller outlined a nightmare situation with eBay's online payment service. Gabriele P. said she upgraded her PayPal premier account to a business account the week of February 3rd because she wanted to start accepting credit cards through an Internet getaway. She said PayPal immediately froze her account

PayPal told her the account would remain frozen until she could straighten things out. But she says she was unable to reach anyone at PayPal in a position to help her. Meanwhile, revenue from her online sales continued to be deposited into her PayPal account, which she was unable to access to pay her bills, including her fees to eBay, which is her main business and income source.

You can read the full story of Gabriele's plight on a thread on the eBay boards.

Gabriele said it took over a week of persistent calling and being put on hold with PayPal to finally get her account straightened out. "Paypal made a spelling mistake with my name on their side when they run my credit check and I only found out about it, when I applied yesterday for a CC with an other company which got immediately approved." Gabriele said that on Sunday, she received an email from PayPal that her account was restored, with no explanation and no apology.

I asked Gabriele what her number one message for other eBay sellers, here's what she said.

*Get a web store, get a merchant account and getaway to process your own Credit Card payments at Ebay and your web site and reduce the Paypal payments to a minimum, better erase them completely, if you can afford it. If your main income goes on a Paypal account and it happens to you, what happened to me, they can destroy your business, your life and all what you have worked for so hard. Never give up calling them multiple times per day, be consistent, try to figure out what went wrong, Tell as many people as possible about your problems, and contact authorities.*

Comments (20) | Permalink

Readers Comments

Desperate Seller Describes PayPal Nightmare

by: Laura

Wed Feb 13 13:24:25 2008

Sorry to hear about your frustrating experience with Paypal.

I think most people don’t realize just how bad they are until they have a problem and soon realize they get no help. They just aren’t motivated to help you get your money back. I have to wonder how many people give up and Paypal just keeps it.

I would like to use someone else. Did you find a low cost alternative? Does anyone have any merchant account recommendation?

Desperate Seller Describes PayPal Nightmare

by: Deanna

Wed Feb 13 15:00:12 2008

Oddly enough, I have had a few minor problems with PayPal (nothing like Gabriele's, however!) and have had no trouble reaching them by phone, getting courteous and helpful responses, and the problems solved fairly quickly. So far, no complaints. I've been using paypal since Aug 2003, and it is my primary payment method.

I have no doubt that really bad problems arise from time to time, with the magnitude of users that they have. But considering that they do have *millions* of users, I think major problems are the exception, not the norm. If it were, they would not still be operating, or grown as much as they have.

Desperate Seller Describes PayPal Nightmare

by: Web Developer

Wed Feb 13 15:10:55 2008

You are absolutely right. Paypal has the worst customer service and their main intention is always to give you as much headache and make things difficult as possible so that you will give up on your money and they can keep it. I have had few instances where they put limited access on my account and ignored my calls and my emails which I had sent with proofs they asked for. I had $350 in my account which now belongs to them obviously. They are a bunch of morons.

Desperate Seller Describes PayPal Nightmare

by: Matchboxcarguy

Thu Feb 14 12:49:57 2008

This is old, old news for PayPal...

They have been doing ''business'' like this for years. Freezing accounts with NO reason and NO explanation since way back before eBay even owned them.

Amazingly, some people keep right on using them after a ''freeze''. If your bank closed for a few weeks & wouldn't let you withdraw money or even talk to you on the phone, would you still deal there when they re-opened? No ??? (Once was enough for me, BTW.)

Gabriele is 110% right. Limit your exposure to them if you can. Especially in light of the new 21 day ''hold'' policy.

Desperate Seller Describes PayPal Nightmare

by: Laura

Thu Feb 14 15:17:50 2008

@matchbox or anyone

But what are some good alternatives? I don't use them because I think they are the best, only because I don't know what else to do.
I have read other sites, and even when others complain they still use them.

Desperate Seller Describes PayPal Nightmare

by: Matchboxcarguy

Thu Feb 14 16:44:15 2008

''But what are some good alternatives?''

Unfortunately, selling on eBay, not much. Especially if you are a newer seller - eBay makes you take PayPal or have a merchant account.

Longer term sellers can still take Checks or money orders. That's what we did. We went ''cold turkey'' on PayPal in April of 2002, after an unwarranted & unexplained account freeze.(We were with them from the beginning and were on PayPal only payments at the time. So much for loyalty.)

We NEVER got a bad check or money order in several hundred transactions. Certain categories though, you won't sell much without PayPal. Buyers are conditioned to using it. Then you have the constant mantra, ''PayPal, it's the safe way to pay''...Yeah right. Maybe backed with a credit card..

Someday, eBay may be forced into taking Google checkout. That would be a good thing for sellers & buyers alike. They will resist it right up till the anti-trust suit is filed, I think. :O)

Desperate Seller Describes PayPal Nightmare

by: Ming the Merciless

Fri Feb 15 01:07:24 2008

Well hidden PayPal toll free help number for both sellers and buyers:

1 888 221-1161

It works.

Desperate Seller Describes PayPal Nightmare

by: segura

Fri Feb 15 02:34:37 2008

Gabriele is absolutely 100% right! Limit your exposure to them if you can & if not then be very cautious with the amount you have in Paypal. They are the worst & their customer service people are MINUS 100000% in knowledge, respect & service. I had a $40. sell slip through to paypal a few days ago so I thought I'd just get the shipping label & pull the rest. Paypal wouldn't allow me to create it there & no errors were in the address. I went to USPS site & created it & another & when I used my paypal debit, it was denied. So I tried again, in case I had made a type error. It was denied again so I paid with a different method & went to Paypal & saw they had actually charged me both times & my account was at $4. I emailed daily at least 10 times (I have a disability & problems holding phones for a long time). They told me it was never subtracted with no account where it is, they say I need to go to my history & see the receiving party, so I can ask them for the money, they said unrelated meaningless replies that have NOTHING to do with the issue. They refuse to tell me what they did with my money. Just as they have the multiple other things I have asked & the money they sold in Nov. & Jan. followed with extra unexplained charges that were charged, like AOL & I didn't have AOL so it took months to get through to them without an account # & PayPal refused to assist me in anyway with the theft they processed & I have never received it back. Thankfully, a merchant account is much less hassle & as long as it is a secured payment site, most buyers do not have a problem & the others send Money Orders. I strongly suggest limiting your PayPal activity or at least move your $ out quickly. They are very deceiving & will financially hurt or destroy you, as they have me & so many other.. read some blogs & sites outside of paypal & eBay and you will see a lot truthful strong warning yellow & red flags!

Desperate Seller Describes PayPal Nightmare

by: lorikeet08

Fri Feb 15 06:17:05 2008

This is one of the reasons why I transfer my PayPal money into my checking account anytime it goes over $100! My account was frozen for about a week, because a BUYER had used a stolen credit card to pay for an item she won from me, and that was MY fault, how--I thought it was PAYPAL'S job to process and accept/reject payments--isn't that what I am paying for?! I can ''live'' without a $100....I can't ''live'' without a $1000 or more--which is what I USED to keep in there--for my Ebay fees and business related expenses.

Desperate Seller Describes PayPal Nightmare

by: vtchris

Fri Feb 15 08:17:08 2008

PayPal just totally LOST a small (thank goodness) eBay payment. I emailed both companies, but 24 hours later no response. I will try the # another poster left.

Desperate Seller Describes PayPal Nightmare

by: h

Fri Feb 15 09:03:05 2008

I too have a nightmare. I was selling on Ebay and lots of people were complaining that I didn't accept Paypal. Well I gave in and opened an account. Finalized only 2 transactions in small dollar amounts. The immediatley after that, BAM Paypal froze my account under "suspicious" activity. There were only 2 transaction. After many many many phone calls to Paypal I got nowhere. They froze my account, refused me my money in which my customers received their product with no problem. THen they tell me it would take 180 days for me to get my money providing there were no problems with these two transaction. This was back in Dec. Now I have to wait until sometime in June to get $200.00. I gave them all the information needed to complete my bank account, but I have had absolutly no direct attention to my account. THEN Ebay suspended me for "abuse" Which was not the case at all. How could I abuse them when all I did was sell some items I had here. A TRUE NIGHTMARE INDEED!!!! We need other venues for selling.

Desperate Seller Describes PayPal Nightmare

by: Trixie

Fri Feb 15 12:13:10 2008

I have had both a Paypal and an eBay account since 1999 and have been a seller as well as a buyer. I left eBay as a seller because the fees were killing me, but I never had a problem with Paypal in all the years I used my account - a regular account that eventually became a Business Premier account - and I will continue to use them for my off-eBay on line store.

Not everyone has problems with Paypal, even after years of doing business with them.

Desperate Seller Describes PayPal Nightmare

by: Tex

Fri Feb 15 12:27:01 2008

Paypal took $300 out of my account because I couldn't prove that a watch was delivered - not mailed, but DELIVERED! I had the proper tracking # that clearly showed it was mailed at a certain time on a certain day but that wasn't good enough. I only use paypal on foreign sales now and ONLY WITH INSURANCE. This pushes the shipping from $10-15 to $35-50 which kills some sales. I also transfer all funds to my bank as soon as they arrive. I used to use BIDPAY but they no longer operate here. What are out options?????? Tex

Desperate Seller Describes PayPal Nightmare

by: joyce

Sat Feb 16 00:57:56 2008

Anyone that deals with paypal needs their head examined. I had one very bad incident several ago and I was instantly cured of doing business with them. I suggest - get your own credit card processor - eprocessing, authorize.net and there are others. Do some research and don't depend on a badly run third rate expensive processor.

Desperate Seller Describes PayPal Nightmare

by: Julieanna

Sat Feb 16 09:44:10 2008

Last week, my buyers were getting one of two messages: either "Seller does not accept Paypal" or "Seller does not accept payment in your currency" (I am a Canadian seller who lists on both .ca and .com, I list in US funds, and I only sell to the USA and Canada).

I contacted Paypal via their site. FOUR DAYS and 5 angry buyers later, Paypal sends on of their canned responses. None of their suggestions had anything remotely to do with my problem.

I e-mailed and re-mailed Paypal at least 6 times. Always got a different person replying to me, but always the same canned response.

Phoning them is a lesson in frustration. Once, I waited an hour and 15 minutes before I finally gave up. Thank God it was the toll-free number.

Thankfully, my buyers were Ok to send money orders, but not at all happy about the situation which probably left them suspicious of me as their seller. I shudder to think how the feedback will go. I know that with the new FB changes, these same buyers would probably all neg me.

And now the new Ebay changes state that Paypal will hold my money any time a buyer complains? Half the time, it's their OWN FAULT!

Count me in as one of the boycottters. I will use the week to set up an inventory reduction sale of my stock, and once that's gone, I'm outta there.

Desperate Seller Describes PayPal Nightmare

by: Shadow Fire Promotions, Inc

Sat Feb 16 23:52:04 2008

For those that say if you sell on ebay, you are forced to use Paypal, that is FALSE, 100%, even 10000% FALSE! My site uses several different online payment methods and NOT google, because there is no easy eay to contact them. The payment methods on my site have been checked and double checked, and I have NEVER had a problem with security, their reputation checks out, and MOST IMPORTANTLY, they are able to be contacted. Phone numbers are clearly listed, I've never had a problem reaching a person, and every experience is pleasant. Does ebay allow other payment methods? Of course not, they are too scared to actually have to compete fairly with another. BUT, you work around it by saying you do NOT accept paypal, and you simply have them contact you for your payment methods, or have them listed on your site.

Desperate Seller Describes PayPal Nightmare

by: Mike

Sun Feb 17 12:32:00 2008

To Shadow Fire Promotions and others: This thread contains several requests for names of alternate payment processors. Why did you post, talking about the other great payment methods you use, but didn't mention their names? If they are so great, tell us who they are.

Desperate Seller Describes PayPal Nightmare

by: Gosquo

Sun Feb 17 17:42:59 2008

I can't vouch for this post:

http://www.paypalsucks.com/forums/showthread.php?fid=7&ti
d=26406

But it sure looks like a possibility.

Desperate Seller Describes PayPal Nightmare

by: erika

Thu Feb 21 12:56:19 2008

I've used Paypal for many things in the past, and have never had a problem with them (fingers crossed). For anyone who's questioning Paypal after reading this, and as someone who knows the industry pretty well, here is my advice. If you're running a professional, legit business and most of your $$ comes from credit cards, set up a merchant account IN ADDITION to having a Paypal account. DO NOT keep your $$ in your Paypal account (only what you need). If you're running a legit business that money should be in your local BUSINESS account at the bank down the road. This way, you can appeal to the Paypal users in addition to having a legit merchant account as well.
You can go here for more information on the subject:

http://www.merchantequip.com/information-center/articl
es/merchant-service-industry-nutshell/

Desperate Seller Describes PayPal Nightmare

by: Shadow Fire Promotions, Inc.

Mon Feb 25 00:57:40 2008

To Mike and the others who want Paypal alternatives: We apologise, we didn't think anyone would WANT an alternative, since everyone thinks Paypal is so great. So to those who actually have a brain, check out our site, sfpincchicago.com. There are several different payment methods we use, displayed prominently on the page. We're also in the process of checking out at least 2-3 others. These are methods we have researched. They don't get hacked into, so no spam mail, like you get from Paypal, we have not experienced an outage, there are real claims processes, and best of all, they don't hide their phone numbers, so you can contact them. Check them out on our site, sfpincchicago.com

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