Coping with PayPal Payment Holds

I have a very important question. You all know that if you are doing Dropshipping then you have to pay for the item so the Dropshipper can ship the item and give you the tracking Number.

So how in the world i can pay for the item if my payment is on hold from Paypal?!!!

It is extremely Difficult to make this kind of business "Dropshipping" on ebay.

I would like you to answer my question and tell me how in the world i can pay for the item if my payment is on hold from Paypal?

Another suggestion to avoid payment hold. This sometimes work but other times may not.
In my auctions I write at the end: " Pls don't pay if you win this item till you have received an invoice from us. This step is for us to keep all our sales record uptodate. your cooperation in this regard will be appreciated" .
As soon as I'm notified of the winner I promptly send the winner paypal(not ebay invoice) invoice and if the winner honors this invoice my payment gets credited right away. I've tried this 3/4 times and only once paypal placed a hold. So I'm not sure if the winner just paid or paid based on the invoice. Last week I'd a winner who was sent paypal invoice($400+) and I got credited. Next day I sent second chance offers( one was for $200). this one accepted and paid right away before I'd a chance to send him the invoice. this payment is being held up.
Other thing: Four times before I've asked paypal for early release of the funds citing that the item has been delivered and 3 days have passed the buyers have not responded either to emails to confirm receipts or have not left +ve feed back. Twice they released the funds next day after I send them the email and twice they rejected. Mysterious are the ways of paypal and ebay. Even though I'm sick of these behemoths I've no choice but to grin and bear because I do make some money using them.

What you do with you account can also have adverse effects. I recently sold an item, and was in PayPal using the Google web browser. I tried to print a shipping label, forgetting that the plug in does not work properly in the Google web browser. I opened internet explorer, logged on and printed out my label with no issues. I did not log out from the Google browser first and apparently this triggered something in their system (presumably multiple log-ons at the same time). The account was frozen for about a week and I could do nothing..., buy, sell, transfer money... nothing. When I asked them what I did to make this happen, they threatened to cancel my account, saying that information was proprietary and they did not have to release it ( I was just trying to avoid making the same mistake again).
I've also had others tell me that they have received payment from someone else for money owed for a non-eBay item and that was held for nearly a month. I can understand the policy for protecting eBay buyers, but what about non-eBay transactions, especially a strictly cash transaction with no goods involved.

This article is written completely from Pay Pals view. It's really nothing that most of us don't already know and certainly have experienced. PayPal put me out of business the first time I tried to get into ecommerce with EBAY.
I had very little money and no product to sell so I was forced into drop-shipping. I needed the money from my sales to buy my product and ship it to customers. It was that simple. But of course PayPal hates drop-shipping even though I could not get anybody at PayPal to admit that. Bottom line is I ended up over with over $100 being held by PayPal for the mentioned 21 days which caused bad feedback scores and you know the rest. I did make good on my payments but never used PayPal again. I got my own website and learned a lot by reading the forums on Salehoo and built my own business using a merchant account and Google Checkout. I avoid EBAY and PayPal and don't miss either.

Without even reading the full article, I can tell you now that what you are saying about if you're an honest seller, there is nothing to worry about having ebay placing your payments on hold, because I personally was one of the most honest sellers to ever operate on ebay. I even went as far as taking losses just to keep customers happy, but time a time again, payments were placed on hold even though ebay couldn't find a single slither of evidence that a customer was unhappy with my service or didn't receive exactly what they paid for and in most case more, until I sold to a powerseller, who goes by the name: royalcarriagelv, whom seller exotic cars like Ferrari, Benz and so on. I sold him a $450 phone, he found it a little cheaper somewhere else and wanted his money back, which I agreed to. He promised to not give me negative feedback in return of a refund, which I was going to give him anyway, but he gave me a negative feedback anyway so I refused to give him a refund, that's when paypal and ebay took over a year to settle our dispute, because they knew I was in the right, but he was paying them much more profits from each car sale than I was with each phone sale so obviously I knew whom side they would take at the end, which took much longer than normal to settle, hoping time would discourage me.

To make a long story short. Ebay took the refund out my checking account and gave it to the customer, the customer kept the phone, ebay still demanded final value fees, closed my account until I paid, which I never did, and their was nothing I could do about it, not even give this customer a negative feedback, which is why this whole thing took place the way it did in the first place, not to even mention this customer promising to maliciously sabotage my account, to get his way, I still have all the emails to prove it, just in case.

I still believe, on ebay, the powerseller is king and ebay will do anything in their power to keep them happy even if it's down right corrupt. So please do even try to explain a strategy to keep ebay from doing what it wants to do for its own benefit.

PS: I didn't proof read this so there may be some spelling and phrasing mistakes

My Profile on ebay was: inlikeben and now I'm going to Amazon.com, it seems just a huge a ebay
if not larger or soon will be.

I've had a couple of transactions held by PayPal. My only frustration and criticism with this policy is that it only becomes an issue when a seller relies on the customers' payment through PP in order to post out the item(s). As this PP policy is rigged so that fee will only be released when customer has left seller feedback and customer will only leave feedback when they receive item, etc - this is the problematic circle. To benefit from this policy if you rely on the buyers' payment (with postage fee built in) to mail out the item - and, should it hit you - you only need a separate supply of 'posting' finance in a physical bank / elsewhere in order to mail out the goods.

I put this query to PP only days ago - on incorporating my store with acting as agent / distributor for an overseas high end guitar range. PayPal told me straight (and, my apologies if some of it echoes the above article):

There is always a possibility that the item you are selling on eBay may
be held or not. Unless the payment is processed by the buyer, that is
the only time that the system will determine whether the payment will be
placed on hold until it meets either of the criteria to release the
funds on your account.

For some sellers, PayPal will hold funds while we ensure that there are
no disputes or chargebacks made against the seller’s account. When
sellers don’t have the funds available to cover disputes and chargebacks
made to their accounts, the associated cost is significant. Managing
this cost is our responsibility – it’s also a benefit to sellers because
it enables PayPal to keep service costs for all our members lower than
other online payment providers.

In deciding whether to apply payment holds, PayPal reviews many factors
including:

1. Account tenure
2. Transaction activity
3. Business type
4. Past customer disputes
5. Overall customer satisfaction

Holds are typically placed on:

1. New sellers or sellers who have limited selling activity - until
they build up a history of successful transactions
2. Merchants selling in higher-risk categories like electronics or
tickets, where we see higher levels of chargebacks and disputes
3. Sellers who have performance issues, or a high rate of buyer
dissatisfaction or disputes...

I hope this helps / contributes to things. What a mad, crazy world trading is.

2 comments.

First, the obvious answer about holds is, don't stop calling people until you find someone who will work with you. This can be harder than you think, paypal suddenly decided that they had to verify my account information, ignored the "successful" online verification (which looks disturbingly like a pfishing scam) and every call after that dropped me straight to a recorded message that told me that something was being mailed, I needed to be patient and wait for 7-10 days. What paypal was holding was my payment to ebay, which they'd just successfully collected from my bank, so I called ebay and told them that. They got me to the right person at paypal who immediately released the hold WITHOUT ASKING FOR ANYTHING.

Second, while I agree that using paypal shipping is the best answer (it hands ebay a tracking number and delivery confirmation for only $0.19 or Free depending on the service), the service is TERRIBLE. I end up voiding as many labels as I can actually get printed, because the actual label-printing service is rarely available. You get 6 or 7 failures (error message) and then a different message that says you've exceeded the maximum number of reprints (never getting it to print even once) and you have to void the label and start over. Voiding the label will get you a refund in approximately 2 weeks, while you pay again for postage. Getting one label to finally print means nothing about the rest (generally I can get two before the service craps out again for hours).
The annoyance adds up fast with lots of items, and the cost adds up fast with expensive items.

However you ship, don't ever ship without a tracking number. No matter how high the buyer's feedback rating is. Getting a refund for an untracked package is free money for them, and a serious hassle for you. Not saying that ebay and paypal won't just pay them even with a tracking number, but without one you're just fresh meat on the internet.

PayPal has been nothing but nightmare to me. I live outside of the US and signed up as an affiliate to sell clothing online. I was told that I would need a PayPal account and so I set about trying to open one. After several tries I was utterly confused. I called PayPal and asked very direct and specific questions. Can I have a business account if I live in _____ country? The agent said yes. Can you help me to set it up? She said I had to do it myself. Eventually I got it and then I received my first payment. I paid my supplier and they shipped the items directly to the customer. Then PayPal reversed the payment. Gave back the customer the money and then told me that I owe them over $100 and Put my account on hold. I went through everything and cleared the account. I started again. Then I received another payment over $1,000. They put my account on hold again. Then after many frustrated conversations with them then I was told that I cannot have a business account in the country i live. Now, I can only advertise in my country and I have to collect money by hand from my customers. -- And I cut this story short. -- What a nightmare.

Thank you for this i am very weary about getting an account with paypal now for my website. At the moment all transactions are processed manually through customer and i with no inbetween. i am unsure if i should go ahead with starting up a paypal account or leaving it the way things are, maybe someone else could shed me some light on this please?

hi, helpful information . fortunately i did not face that bad situation until now . i do dropship business on ebay , what i do exactly as you mentioned , i sent the track number to " paypal" , once i see " on courrier website ' my customer received his item i contact him to get the key to release my payment i mean " positive feedback "

- another comment to " ayman badr" . forget to do dropship business on ebay without some investment .

thanks for salehoo team work

I just want to offer a few comments here about our experiences with eBay and PayPal. I was surprised to learn that so many people have had a negative experience with PayPal. We have been active on eBay for over 10 years, and were using PayPal before eBay bought it outright from its original founders. We have never, and I mean NEVER, had a problem with either entity. We have found PayPal to be a boon and a blessing to operate on eBay and, indeed, outside of eBay, too. I have purchased various items over the Internet, using PayPal as a medium of exchange. We buy and sell on eBay with no problems whatsoever. I hope that continues to be the case. I am offering these comments with the hope that others out there who may happen to review this blog, will know that all is not bad with eBay or PayPal. With particular respect to eBay, we think it is one of the, if not the only, best run website on the Web. It is user-friendly and logically functional, and was so from the outset. We hope it will be around for many decades to come! Best of luck to you all.

POOR PEOPLE TRYING TO SELL SOMETHING REALLY OR DESPARTLY NEEDING THE MONEY AND PEOPLE TRYING TO START AN ONLINE BUSINESS ON DISABILITY AND SSI AREN'T GOING TO BE ABLE TO SHIP WITH OUT THE SHIPPING FEE FROM THE SALE. THEREFORE PAYPAL IS JUST PREVENTING BUYERS FROM GETTING THERE ITEMS AND SELLERS FROM GETTING MONEY THEY REALLY NEED. TRANSACTIONS ARE JUST BEING WRONGLY DRAGGED OUT. THIS CRAP PAYPAL HANDS OUT IS RETARDED. THERE ARE MANY WAYS TO ATTRACT BUYERS WITHOUT SCREWING THE POOR AND INCOVEINENCING BUYERS WHEN THEY BUYER FROM PEOPLE THAT ARE POOR. I'M SICK OF EBAY AND PAYPAL NOT CONSIDERING AND SCREWING THE POOR WHEN THEY CHANGE POLICES AND OR ADD NEW ONES.

Well.....out of all the posts I've read here not ONE of them agrees with the article. Ebay/Paypal management should take note but they are oblivious and so arrogant as to think its their way or the highway. Ebay/Paypal carry the reputation of being the most hated companies on the internet they do not know how to keep their customers!....nuff said.

ive recently created my own website to offer websites for customers and after reading all the comments Ive now decided to use Paypals invoicing system to send an email invoice to the customer to make payment and this is all I will do with them.

I think when i decide to do DROPSHIPPING now I will only use a MERCHANT company to get receive my payments rather than use Paypal or even EBAY. Although as for my website as Im not selling any goods Paypal presumably will be ok.

Ive had similar problems in the passed from others and totally agree with these kinds of issues although not exactly experienced these exact problems.

In response to Mr Ben Wright's comment in august 2010 about his experience with paypal. Nothing can be further from the truth. Let's examnine the evidence, he claims to be the most honest seller on ebay but he was in the business of selling illegal countfeit cell phones! Can we see the irony here? Second, he claim to be a victim of paytpal hold when when he was the one who cannot answer my repeated request for tracking number and i gave him twice the promised time to come up with the phone and it was one excuse after another. His most creative and rediculous one was he did not want to upset the clerk in china for asking her to work too hard to see where the phone is. In the meantime, the phone which was a gift for my wife as xmas gift was no where and apparently my wife's emotional state was not as important as the clerk in china who apparently was so stressed by me asking for a tracking number. His lack of common sense was astounding. Paypal asked for the same info and when he cannot supply a simple thing like a tracking number or proof of delivery to anyone, they charged him back which is how it is suppose to be, in this particular case, paypal worked the way it is suppose to protect buyer from the MOST HONEST COUNTERFEIT SELLER ! His further comment about people who did not agree with him msut be working for ebay or paypal is further evidence of his delussional claims and business ethics. It is funny that all my customer spending huge sums of money buying exotic cars never ahve any issues nor did the hundreds of sellers selling methings from camera to rolex watches also have never had a problem with me paying and finalizing all my transactions in a honest and timely manner. All i can sugest to Mr Wright is seek professional counselling, we are not all out to get you .
Also another fiction by him is that there was never a hold, he got the funds and when he cannot proof he did anything, they charged him back.....that is not a hold, that is a simple charge back. Hold is when you never got the funds, which os not what he claims , but then again we are talking to the most honest seller who just happen to be jkicked off ebay and paypal and who also ahppen to be selling illegal counterfeit phones, why would we doubt his words? LMAO

you can't just make stuff up! we live in a civilized technology age, we can't return to barbaric ways of bullying sellers by made-up rules that are practical nor sensible!

I am a new member of SaleHoo. All your comments and ideas are so much helpful for the new starter. I like all the article. I am now planning to start my business on February, anyone who can give me some ideas of reliable merchant account company who is dealing with all the cards and can be is affordable for the new starter? All your recommendation and suggestion will be much appreciated. Thank you....

PayPal & eBay. A dream turned into a nightmare. As eBay and PayPal continue to build The Fourth Reich online, If you use it in this day and age, you will regret it; if not now, in time you will. If the DSR's are so darn important, eBay should REQUIRE feedback to be left from purchasers. I, too, was a victim of the drop shipping payment holds. I couldn't order the products for the customer until the funds were released. Because they are an online payment service, and NOT an online payment gateway, they are not required to follow or abide by FDIC banking regulations, so they operate as they please, punishing the little guys and pampering the powersellers and corporate conglomerates. Also, I got an email message saying my account has been frozen until I can provide some more information about one of my sales, and an ID# was provided. I called them on the phone several times about this trying to find out what information from which sale they needed, but they say they don't know what I'm talking about as nothing is showing on their end, but my account has been permanently frozen with almost $100 still there that I cannot access for over six months, but yet I didn't do anything wrong. I asked them why, but they couldn't give me an answer other than it's something the "Back Office Execs" decided on a whim. I asked to speak with one of them, but I got a shocking, "Oh, no, they are unavailable for customer support issues such as this, and am left dealing with someone who just wastes my time by telling me there's nothing they can do about it. If you do use drop shipping services, be very wary, as you could be held accountable for mistakes made by your drop ship suppliers. One guy filed an "item not received" dispute after I provided him with the tracking number and it was showing up as being on its way. Guess what? He received the item, and eBay issued a refund without my knowledge or consent. I got an email saying, "we have refunded the buyer for this dispute and you now owe eBay for the amount refunded". I never got the item back, case was automatically closed, and I still had to pay the final sale value fee. Also, I sold an Autographed Football to a lady that complained, saying it was flat and would not hold air. She sent it back for a full refund, which I was happy to give. When I received the ball back, it was not flat, and holds air just fine. I tried to inform eBay of this and offered to pay the shipping to send the item back as the ball is fine and the lady was not honest about the condition in which she received it, but case closed and refund given, and final sale value fees paid. Bastards. I sold about 200 items last year, and only got feedback for 117, and only two were negative, but it was enough to drop my feedback percentage to about 98.6%, after which eBay and PayPal feel you are not worth their time, and punish you by putting your listings in last place on search results. I went through the same thing with PayPal. I haven't won a dispute yet, even though I provided all the correct documentation, gave refunds to buyers who received the items. Some items were never even sent back to me, and I was still forced to give refunds. So, after a year of dealing with them, and losing money instead of making money, I signed up for Authorize.net because eBay told me that was one of the options available for accepting payments for purchases, but when I tried to link it up to my listings, eBay told me I had to be a Webmaster to do it; either that or sign up for a Payflow account (which is also controlled by PayPal) for an additional $175 setup fee and a monthly fee. Forget it.With all their constant changes in listing restrictions, policy changes, and the latest and greatest "PayPal" takeover, they've made it nearly impossible to sell anything there, when it used to be the place to buy and sell anything. All this combined with a blatant lack of customer support and service, it's no wonder they reported a quarterly loss for the first time since they started operations. They have also lost more than 3 million eBay users. With over 40 million users, this may not seem like much, but most of those were Power Sellers with big time items and stores. I have been in communication with many of them, and they have completely closed their stores, removed their items, and closed their accounts due to the constant increases in fees, policy changes, and lack of technical support. I am starting to see a lot of them at www.bonanza.com, of which I am also a member, but the newest, latest, and greatest site I have found is www.addoway.com. Find me there at this web address: www.addoway.com/tuckerstuff. It is what eBay used to be and has made buying and selling online fun again. It is the friendliest community of buyers and sellers that I have yet to find anywhere online. They have a Facebook Meet n Greet Fan Page where you can post your store links, Twitter profile link, and they are more than happy to share and Tweet your listings for you. Any technical questions I posted there have been answered sometimes within 5 minutes after posting. Compared to eBay, it is a joy and a pleasure to post a question and get a kind, friendly answer without sorting through 50 pages of "Help" menus and "FAQ" pages only to discover there is no answer for your question. It is amazing and impressive, with one page user-friendly listing creation, free to list, free if it sells! If Addoway keeps going like this, eBay may have to rethink it's strategies. In a desperate attempt to get people back, they are now offering up to 50 "Free to list Auction Style" listings every month, but you still have to pay the final sale transaction fee of 10%. With the PayPal takeover, though, this has made it impossible for me personally. I hate PayPal and their restrictions, as well, and I have my own Shopping Cart service to process credit cards online, but eBay says I have to be a Webmaster in order to link it up to my listings. Either that, or sign up for a PayFlow account, which is and affiliation of PayPal, with a $175 setup fee and another monthly charge on top of that. Forget you, eBay, there's some new players in town, and they are better than ever as more and more people start realizing that eBay is no longer number 1, and is falling fast. I just hope I am around to see them totally collapse. They've made it impossible for the small time sellers, and is more of a Corporate Conglomerate nowadays more than anything. Online sellers unite! Bonanza.com and Addoway.com are the next rising stars in online selling, so join today and enjoy hassle and headache free listing, buying, and selling.

www.bonanza.com/booths/tuckerstuff
www.addoway.com/tuckerstuff
www.tuckerstuff.ecrater.com

My shops are the one-stop shop for all your Hawaiian and tropical needs, from quality Hawaiian print clothing for men, women, and adorable baby girls Hawaiian Capri sets, Hawaiian Essential Oils, Bath, Body, and Beauty products, Tropical Themed Restaurant&Tiki; Bar Supplies, Hawaiian Fabric in Cotton or Rayon available in 5 Yard cuts, Kahala Brand Shorts, Shakabera, Shakatime Hawaii, Maui Diver's Jewelry, and other major Hawaiian brands are now being featured. A combination of Novelty collectibles, household items, and quality merchandise. Open your own store today, and import all your listings and feedback with the "one-click" importer link at both Addoway and Bonanza. They both allow you to accept multiple forms of payment, from checks, money orders, and cashiers checks, to PayPal and Google Checkout, and you don't have to be a webmaster to do it! Sign up today and you will be glad you did. They do not get the net traffic that eBay does, so items may move a little slower, but I think that will change over time as more and more people realize what a "screw job" eBay has become and continue to search for alternatives. You can't get much better than either of these two sites. I love them both and am happy to be a member in the friendliest communities of buyers and sellers on the net. If you don't believe it, just try it and see for yourself. You will not be disappointed.

Very Frustraing when the parent company ( eBay) allows one thing (dropshipping or pre-sale orders) on their website but thier child-subsidiary (Paypal) does not allow such activity. So you have one issue that will bring huge profits for a business but also may wreck that same business when a company holds your money up to 21 day(s) and have no way to pay for the item to ship it and your customer is breathing down you neck for the item that they ordered. What does a person do when first starting out in a high profit category and keeping their carry cost down to offer the best price the right hand says you can do one thing but going to be punished later on when a company decides to suspend your account and hold it longer than 21 days that ends up to 180 day(s)\6 mos. Either eBay eliminates the allowance of drop shipping or tell paypal to accept the practice. Another thing, when Paypal requests information, like name of suppliers like I did in my case ( name, address, phone numbers, etc.) and they come back verified, they need to accept such information and release the funds. Be a different story if I did not provide the info. and\or could not be verified and I just ran but did the right thing and gave my sources but still got punished and they still closed my account.

Hey does anyone know what I can do to get my payment hold released? I've looked everywhere. I haven't sold anything in ages and have nothing pending. I literally transferred some money into PayPal from my bank account so I could buy something off of eBay and now there is a hold and I can't get it anymore. It's because of this crap that I refuse to use eBay and PayPal anymore but I found something I really wanted a good deal on and thought I'd make an exception. Bad idea. Do I just have to wait it out.??? Thanks, I'd appreciate any feedback.

Here is another issue with both companies, if eBay belongs to PayPal, why the double charging? I hope a huge court case will be brought against this company to teach them a lesson. It just shows you don't need weapons to be a robber or a thief, this is robbery of the highest but unsophisticated kind.

I made a sale for 159 pounds, ebay charged me 16 pounds for final value fee, not to mention 3 pounds or so for the initial listing and when the buyer made a payment va paypal and the funds dropped into paypal about 9 pounds was missing but yet the funds was on hold till the buyer left feedback but to add more insult when I made a payment once the funds cleared to another paypal account another few pounds went missing... thiefs I really cant wait to see a damaging court case against them.

Paypal holds are a pain, but you must prepare for them as they are not going to get any better. In fact, with increased risk in world markets, I expect them to push for 10% on every account and maybe try and hold certain payments for 30 days.