There are probably greater risks to a company if the case goes to something like a jury trial. Here, they may have run afoul of 'political discrimination' which some locales have made illegal. For example, there was a 'refusal to provide services to a Trump employee' case in New York:
> "Had the incident taken place in Washington, D.C., it would have likely been illegal. The District of Columbia has an anti-discrimination law covering political affiliation. In Madison, Wisconsin, it most certainly would have been. The city’s broad non-discrimination clause defines political beliefs and physical appearance in its law. Political views can include 'opinions, manifested in speech or association, concerning the social, economic, and governmental structure of society and its institutions.' "
Hence a dedicated person could plausibly incorporate their business in the District of Columbia, and then bring a (potentially very expensive and public) lawsuit against PayPal on the basis of political discrimination. Such incidents might be relatively rare, but they could also have major negative PR effects as well as the possibility of large jury awards, outcomes that binding arbitration is designed to avoid.
https://huckleberry.com/blog/right-to-refuse-service/
As far as where the line between 'respectable political affiliation' and 'member of a violent organization' lies, Irish history is worth looking at, i.e. Sinn Fein vs. the IRA.