Ask HN: What to do when PayPal disables your account for no reason?

[notdan]

My wife has a shopify store, does about $1k per month and less than half of that goes through paypal. Out of nowhere today they disabled her account for 'violating user agreement'. She didn't do anything out of the ordinary or suspicious, just getting paid for some shopify orders. Doesn't have any complains or issues or chargebacks or anything I can see that looks suspicious. There doesn't seem to be any way to contact support, dispute the problem, etc. Super frustrating. Is there anything she can do, or is she just literally not able to use Paypal anymore without any explaination?

[tpae]

I've fought with PayPal for a very long time for these same reasons, and I finally won last year, and received a settlement payout (basically the money that was in my account, worth $6k). The condition was to never use their products / services again (including venmo, every time someone asks if I have it, I have to tell this story ;)), but totally worth it.

I used a service called FairShake - https://fairshake.com/ which is an arbitration service, and you can use this to get their attention.

[vmoore]

I ditched PayPal after they put my funds 'on hold', and after researching this, Googling around, it seems it happens to everyone at some stage. They flag accounts when transactions amounts are 'higher than normal'.

But my income from my store is volatile anyway, so large amounts out of nowhere is normal for me. PayPal doesn't understand this though, so I ditched them. Never got my funds back, and I'm still fighting to get my funds back a year later.

Support is an actual joke. You get forwarded to different support staff, and when you reach a human, they can't help and are woefully unprepared to sort out your situation.

[atlantic]

Use Paypal for payments only, and keep your balance at zero, by connecting your account to a credit card.

If you keep any funds in Paypal, they will steal them sooner or later. There is no recourse.

[Accujack]

Exactly. Paypal should be regulated as a bank. They're a de facto monopoly for auction payments, but they are covered by fewer banking rules than money transfer businesses.

They have no obligation to be fair and there is no real appeal path for any decision they make whether it's obviously wrong or not.

[tluyben2]

This cannot be posted more and high enough; never use PayPal as a merchant! Don’t keep money there and just use it to buy things, or just don’t use it at all. It is and has always been an awful company.

Depending where you are and your revenue, use an acquirer or local processing partner directly. Integration will be a little more painful, but with many benefits; cheaper and human support. In NL Mollie never failed me. I have used Ogone as well; they have been taken over a long time ago, but the support was still excellent 5 years ago.

1. When we (we didn’t know) were using it 15 years ago we were making well over a million/year in the gaming market and they locked our money for no reason. If you have to buy inventory (which we did; our profit margin was ~10%) as a startup, which we were, this can very easily kill you. And you cannot reason with them.

2. When I tried to cancel my business account (20 years old) a few years ago, it took 2 years and 100 telephone calls and emails; they said I could not cancel it because my company still was trading. They added (somewhere in 20 years) the wrong company number to the account (not my company; not sure what abuse and hell I could’ve caused these people as companies are held to standards over here). After 2 years of phone calls and emails, the last email I received was ‘sorry, but you cannot use PayPal anymore and your account has been deactivated because your company seems not to exists’. It would be hilarious if this was a 2 person startup trading a few million$; instead it’s a 31k employee and 76b$ asset company and a complete shitshow. Not sure what they do all day besides counting dollar bills. No one can be proud to work there anyway.

Stripe seems to rapidly go there now. Anyone up for starting something that makes this payments stuff fun and human again? I have the contacts.

[rejor121]

Yeah PayPal is a mess.

I have no idea what it would take the start something to make payments better and easier to deal with. I’m down to help out; my wife (cpa cma finance) is probably going to pick apart any business plan that involves financial transactions.

[leemelone]

Close your Paypal account. While you're at it close your Venmo account.

[toast0]

Sign up for a different payment service? Sounds like she's already got something that was used for the other half of payments, but it's good to have two options, so she'll need another one.

Send a written demand for the balance, possibly with help from a lawyer. Don't expect them to resume servicing her account, but I guess you could ask for that too. Transfer money out ASAP, always.

[brudgers]

Honestly if you are in business, you just let things like this go and move on.

Then you can gather information at your leisure and address the problem slowly and thoughtfully.

Maybe raising prices is a profitable first step. Even if there’s little correlation.

Good luck.

[napsterbr]

It's too late for your wife (and I don't have any suggestions here) but for the others who still rely on PayPal: leave as soon as possible. It's a matter of time until the same happens to you.

[thrownawaydad]

People deserve forgiveness. Corporations do not. Act accordingly.

[spicymaki]

I never keep more than $1000 in PayPal. It is not a bank, and is not held to the same regulatory requirements.

[gregoryl]

Lawyer.