If you are a frequent user of PayPal, chances are that you have received that dreadful email that informs you that your money is on hold. It’s a message that can elicit a lot of confusion, if not outright anger. I know because I’ve been there.
So, what are the reasons that PayPal might be holding your money? And what can you do to expedite the release of that money? Let’s take a look.
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Why is PayPal putting my money on hold?
Here are the most common reasons that PayPal might be holding your money.
1. You are a new seller or are an established seller but have opened a new account
Millions of sellers across the world use PayPal to receive funds from customers. But if you’ve just started selling recently or opened a new account, you’ll need to build up a positive reputation first and then your status will change.
2. You haven’t sold or transacted anything in a while
Just like with new sellers, if your account has been dormant for a while, you’ll need to rebuild your credibility through a positive transaction history.
3. Customers have filed for refunds, disputes or chargebacks
According to PayPal, if multiple customers file for a refund, dispute or chargeback or if your account has been flagged for a large number of these issues in a short period of time, it can delay the availability of funds.
The best way to fix this is to work directly with customers in order to resolve any issues.
4. You have a suspicious selling pattern, or your selling pattern has changed
If your account exhibits unusual sales activity or a change in your selling pattern, such as a sudden increase in the volume of sales, a change in types of items sold or a change in average selling prices, PayPal may flag your account and hold your money.
5. You are selling higher-risk items
Sometimes, PayPal can hold your money if you are selling higher-risk items. Examples of items that PayPal sees as higher risk include gift cards, tickers, consumer electronics and travel packages.
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How long will my PayPal money be on hold?
Your money will be put on hold or in your pending balance for 21 days. According to PayPal, as long as there are no problems with the transactions, you should receive your money by the end of this period.
How can I speed things up?
1. Print a Royal Mail shipping label
If you print a Royal Mail shipping label for your package directly using PayPal, your payment will be released within one day of the courier confirming delivery.
2. Provide tracking information
If you use one of PayPal’s approved couriers, you can upload the tracking number of your package and PayPal will release your payment within one day of the courier confirming delivery.
3. Notify your customer or buyer to confirm delivery
If the payment is for a service or an intangible item, notify the customer to confirm receipt of the item. PayPal will then release your money.
How can I prevent PayPal from holding my money?
- Create a top-notch seller status and build up a good buyer-seller transaction history (needless to say, this might take you some time).
- Be careful with the items you sell. If possible, stay away from items that PayPal considers to be higher risk.
- Stay consistent and honest with your customers during every step of the transaction process. Answer their questions, provide accurate product descriptions, be upfront about shipping costs and settle any issues that arise promptly. Also, consider setting up a customer service message.
Final word
Having your money held by PayPal can be a very frustrating experience. But try not to get too worked up. It’s a fairly common occurrence. There are steps you can take to ensure and hasten the release of your funds and avoid future holds.
If you feel like you’re no longer getting the best value from using PayPal, you can always explore alternatives such as Google Pay, Payoneer and Skrill.
