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"PayPal took $80k from me and banned me"

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Re: "PayPal took $80k from me and banned me"

#101

Post by mpeg »

aga98mtl wrote: post #81
mpeg wrote: post #22

Ok so I know a bit about this as I had the same exact thing happen to me in the past. The reason this probably happened is that their business was getting a high % of chargebacks from paying customers, paypal is not a specialist payment provider that wants to handle what they consider high-risk business like that, so they block your account and hold your funds for 180 days and during that time keep processing chargeb…

If you are at or above 1% chargeback you are going to get problem at any normal payment processor. Source: https://www.chargeflow.io/blog/chargeback-threshold-limits

Yep! In my case I switched to a processor that had higher fees but had less of an issue with chargebacks.

Having said that, I think these days there are ways to limit your exposure, for example requiring 3D Secure for every card payment, as well as tools like Stripe Radar that help reduce fraud.

Re: "PayPal took $80k from me and banned me"

#102

Post by dewey »

drcongo wrote: post #100
dewey wrote: post #95

Earlier quoted context omitted.

Every third party integration a company relies on is risky, I just take an issue with spreading FUD and calling a probably top 5 by market share payment provider only fit for hobby projects. If you are searching for Stripe or any bank you'll find an equal amount of horror stories which are of course always louder than the millions of accounts and transactions that go on without an issue.

It's not FUD if it's true. The fact that it's popular in Germany doesn't mean that they don't randomly shut down people's accounts and access to their funds. PayPal has a long and storied history of doing this.

Search for any other payment processor and you‘ll find similar stories. These services very often work on a „block first, ask questions later“ basis.

Search for „Stripe blocked“:

- https://news.ycombinator.com/item?id=30705500 „TELL HN: Stripe STOLE OUR $159k“

- https://news.ycombinator.com/item?id=36967159 „Stripe is no longer a suitable payment processor“

- https://news.ycombinator.com/item?id=34614844 „Stripe Holding my money for 120 days“

- etc.

Re: "PayPal took $80k from me and banned me"

#103

Post by beeboobaa »

posting_mess wrote: post #96
beeboobaa wrote: post #62

Earlier quoted context omitted.

An $80k interest free loan sounds pretty nice

Any evidence it appears on balance sheet / they use it as capital for investments? or are you just parroting a line you heard someone say one? Parent comment makes it fairly obvious why they are holding the money, seems entirely sane and reasonable - or do you think PayPal should take on an $80K risk? Would you or your business? (in this very specific context)

You think they're holding it in a 0% interest account? That'd be foolish. And we know the people they steal from aren't getting their due interest.

Re: "PayPal took $80k from me and banned me"

#104

Post by gndk »

helsinkiandrew wrote: post #49
gndk wrote: post #44

I have nightmares about this. The comments here saying that PayPal is just for hobby projects and should be avoided are living in a different reality. For me (e-commerce business, mainly in Germany), PayPal makes up around 70-80% of revenue and isn't easily replacable. I'm sure some customers would whip out their creditcard (if they even have one) or enter their long IBAN bank account numbers for direct debit, but ma…

What about adding Stripe/Google Pay/Amazon Pay as a choice, or if you have enough revenue history VISA etc through a merchant account. The real issue is that if you start getting chargebacks - you will be liable for them. A bank might ask for payment, Paypal just grabs any money in your account and locks it. If you keep an eye on the level of chargebacks you should be able to sleep better!

Adding more payment methods is definitely key. But like the sibling comment says, they don't come close to PayPal's popularity. So its a reasonable fallback, but I wouldn't remove PayPal voluntarily.

Chargebacks are interesting in our case, since we barely get any and if we do, we solve any cases super quick. I remember a few years ago, I talked to some PayPal representative from their business team (so higher level, not normal support) and they mentioned how they had never seen an account with such a low amount of cases. Keeping that up is a big focus for us.

Re: "PayPal took $80k from me and banned me"

#105

Post by mcv »

CalRobert wrote: post #58
gndk wrote: post #44

I have nightmares about this. The comments here saying that PayPal is just for hobby projects and should be avoided are living in a different reality. For me (e-commerce business, mainly in Germany), PayPal makes up around 70-80% of revenue and isn't easily replacable. I'm sure some customers would whip out their creditcard (if they even have one) or enter their long IBAN bank account numbers for direct debit, but ma…

Not sure what your sector is but how is Paypal easier than paddle, stripe, chargebee, etc? Actually, how do people buy stuff in Germany? I'm in the Netherlands and everything uses iDeal, which was annoying at first but now I like it. I use a credit card otherwise. When I was in Ireland I used a debit card which functioned like a credit card.

iDeal is how all online payment should work in my opinion. The merchant only needs to know to which bank they should redirect you, and that's all. Your data and your money as as safe as your own bank is able to make them.

The only downside is that it's only for Dutch consumers, and therefore international support is very spotty (Steam supports it, Lego does not). This weekend I heard a rumour that they might be making it international, though. That would be really nice.

Re: "PayPal took $80k from me and banned me"

#106

Post by xyst »

TIL: from reading comments here. PayPal, an American company, is very popular with German businesses and consumers.

As an American, I only used PayPal to send and receive money to/from dad. I have seen a few pushes to use PP, but mostly in the e-commerce space for some promotion. “Use PayPal, get extra X% off price!”

Personally, I am not a fan of the debit/credit world. I will use them simply out of necessity and “cashless” society. But there are much better ways to pay people and businesses that don’t involve a sea of middleman siphoning off percentages or pennies of each transaction.

Re: "PayPal took $80k from me and banned me"

#107

Post by addandsubtract »

gambiting wrote: post #76
reisse wrote: post #57

Earlier quoted context omitted.

It's more complicated. In theory, you should not be able to chargeback any transaction at will, you need to provide a reason for it. But because US banking is stuck in between of 90s and 00s, to pay with the card online it's enough to know what's printed on the one side of it, maybe two sides. Therefore, "fraud" can always be used as a chargeback reason ("Oh, it wasn't me, someone taken a photo of my card! I definite…

To add to that - it's crazy(but also kinda cool?) that in US you can request an instant chargeback and the bank just does it no questions asked. I tried a chargeback on my British Credit card recently because the goods I ordered were never delivered, but it still took 60 days for the claim to be processed .

I even had a back and forth to get my chargeback accepted. The product I ordered was broken on arrival and return shipping was like 40% of the product, so not worth it. After initially accepting my chargeback, the merchant somehow reopened the case and I had to state my claim again.

It really is crazy how easy chargebacks are in the US in comparison.

Re: "PayPal took $80k from me and banned me"

#108

Post by gndk »

ghusto wrote: post #99
gndk wrote: post #44

I have nightmares about this. The comments here saying that PayPal is just for hobby projects and should be avoided are living in a different reality. For me (e-commerce business, mainly in Germany), PayPal makes up around 70-80% of revenue and isn't easily replacable. I'm sure some customers would whip out their creditcard (if they even have one) or enter their long IBAN bank account numbers for direct debit, but ma…

> The convenience of PayPal is unmatched Every time I see PayPal, I hit the 'nah, just let me fill in my card details'. I think you're overestimating their worth, and underestimating both your customers and the competition. As someone already pointed out: "Stripe/Google Pay/Amazon Pay" are available, to name just the most recognisable ones. There are others with better fees!

Maybe I'm overestimating and most customers would go through the trouble of manually filling in their payment details, but it's scary to find out :-)

Fees are a good point. PayPal's fixed fee (0,35€ per transaction on top of the percentage) is actually kinda painful, since we have relatively low average order value.

Re: "PayPal took $80k from me and banned me"

#109

Post by gndk »

aeyes wrote: post #69
CalRobert wrote: post #58

Earlier quoted context omitted.

Not sure what your sector is but how is Paypal easier than paddle, stripe, chargebee, etc? Actually, how do people buy stuff in Germany? I'm in the Netherlands and everything uses iDeal, which was annoying at first but now I like it. I use a credit card otherwise. When I was in Ireland I used a debit card which functioned like a credit card.

They are probably selling on eBay where it is (or used to be) very tightly integrated. In Germany eBay used to be very popular and that's how PayPal got so popular, it is one of PayPal's most established markets.

No, not selling on eBay, only through our own website. But you are probably right about eBay being the the reason for PayPal's popularity here.

Re: "PayPal took $80k from me and banned me"

#110

Post by gndk »

nness wrote: post #55
gndk wrote: post #44

I have nightmares about this. The comments here saying that PayPal is just for hobby projects and should be avoided are living in a different reality. For me (e-commerce business, mainly in Germany), PayPal makes up around 70-80% of revenue and isn't easily replacable. I'm sure some customers would whip out their creditcard (if they even have one) or enter their long IBAN bank account numbers for direct debit, but ma…

I wonder if this might be a case of PayPal in the US vs. Europe — at least with regards to charge-backs. It seems that the burden of proof in the EU is much higher before an issuer will allow a charge-back — at least anecdotally, the credit cards I've used require you to prove that you tried to resolve the issue with the merchant first, prior to charge-back. Even then, charge-backs would negatively impact your accoun…

I think many people in Germany actually have their bank account linked with PayPal, not their credit card. So PayPal uses direct debit to get the money from the customer and "floats" the payment to the merchant.

Direct debit payments in the EU can be reverted within 8 weeks with just a few clicks in your online banking. Those cost around 8€ to whoever debited (I think thats cheaper than CC chargebacks?). I've never done it, but I think you don't even have to put a reason. That just starts the process though, so they might have to add more information later.

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