PayPal is an online platform for sending and requesting money. As one of the leading online payments platforms, PayPal is a popular choice for freelancers and eCommerce stores. Almost every eCommerce store will have the option of paying through PayPal. According to DMR as of 2019, PayPal has over 277 million active accounts and over 22 million merchant accounts. It serves over 200 countries and accepts over 100 currencies. These stats show just how popular PayPal is as a payment method. However, their strict and sometimes ambiguous terms make it unfriendly to a lot of people outside the US. Operating a PayPal account particularly in Kenya can be a nightmare. Here are some common PayPal problems and how you can fix them.
1. PayPal Account Limitation
PayPal, for various reasons (or no reason at all), can limit your account at any time (this is why you should always withdraw any funds in your PayPal as soon as you receive them). This is one of the biggest challenges that PayPal’s users face. It is always a nightmare when it happens. Limitations means disabling some features such as the ability to:
- Send money
- Receive money
- Request money
- Send refunds
- Close account
- Withdraw money
- Remove a card
- Add funds into your account
The severity of the limitation differs from case to case. At the simplest level, you are only required to change your password and answer security questions. At the worst level, your account is limited permanently and you cannot appeal the limitation. After your account has been limited, PayPal requests you to upload various documents such as:
- Photo id
- Invoices
- Card statement
- Bank statement
- Utility bill etc.
But why does PayPal limit users’ accounts? Most of the time, the communication you receive from PayPal is not clear on why your account has been limited. It will be up to you to guess what you did wrong.
Six Reasons Why PayPal Limits Accounts
- Unauthorized access. PayPal’s systems may detect access into your account by another person other than you. In order to protect you, your account gets limited until you can provide some information. Sometimes, this can happen when you log in using an insecure internet service such a Wi-Fi, using a cyber café, using a different device, hiding your IP address, etc.
- Sudden change in your sales volume or what you sell. E.g. if you normally receive payments of amounts less than $100, receiving a payment of $1000 may lead to limitation.
- Operating more than one account. PayPal only allows one business account and one personal account per person. If you own more than one account and they all bear similar details, it’s only a matter of time before they all get limited. Instead of opening multiple PayPal accounts, you can have up to 8 different email addresses linked to your one PayPal account.
- A high number of disputes or chargebacks. If you get a lot of disputes from your customers, this makes you look like a scammer.
- Failure to confirm your identity. Once PayPal requests you to confirm your identity, you have 30 days to do so. If you fail to, your account gets limited until you provide all the requested information.
- Non-compliance to PayPal’s policies, terms and conditions.
2. PayPal Payment Holds
PayPal can hold any money that is in your account for “security” reasons. Yes, they always say it’s for security reasons. Mostly, the hold will be for 24hrs. In other instances, however, the hold will be for 21 days. When a payment is held for 24hrs, there is nothing you can do about it. You have to wait for the 24hrs to lapse after which the payment will either be released to the recipient or be reversed back to the sender. This hold is automated.
On the other hand, when a payment is held for 21 days, PayPal gives you an option through which you can get the money sooner. It involves cooperation between both the sender and the recipient. The recipient needs to confirm that they delivered the goods or service for which they got paid. Consequently, the sender needs to confirm that they received what they were paying for. When that is done, PayPal releases the money instantly to the recipient. Otherwise, the money will be on hold for 21 days before it is made available to the recipient.
Lastly, PayPal holds your money for 180 days if your account gets limited and you are unable to convince them to lift the limitation. After 180 days are over, your money becomes available for withdrawal.
3. Inability to Send Money
PayPal can put a limitation in your account’s ability to send payments. On trying to send a payment, you will get an error message. There are two different errors:
1. “Sorry we can’t send your payment right now. Try again later”
Why does it happen?
There are two main reasons:
Your account is new. This “limitation” will mostly happen when your account is new. However, it occasionally happens to old accounts as well.
There is unusual activity in your account. When PayPal’s bots detect something unusual happening to your account, its ability to send money can be temporarily limited. Such activities include but are not limited to: logging in over a new IP address, a different device, a new physical location/country, and change in the volume or frequency of transactions you do, etc.
How do you solve it?
The first instinct tells you to contact PayPal. However, the error is automated. As such, human intervention cannot solve it. Even if you contact their customer service, you will be advised to either:
- Tell the person you are paying to send you an invoice or
- Log out and try again after some time.
2. “Your payment was declined. Contact your card issuer to find out why, or choose another payment method and try again”
When sending a payment, PayPal deducts money from your preferred funding source by default, which is either your PayPal balance or the linked card. This error occurs when PayPal tries to charge the card linked to your account instead of your PayPal balance. This can be as a result of you erroneously trying to pay from your card, or trying to send more money than what is available in your balance.
If you encounter the error, confirm that you are paying from your PayPal balance and not your card. You also need to make sure that the funds in your account are available, and not in pending status. If you had received the funds from a different currency from the one you are paying in, the balance in your is an estimate (the actual balance is slightly lower). As such, you cannot send everything and leave a zero. Reduce the amount you are sending by about $0.5.
4. PayPal Account Verification
After creating a PayPal account, you are required to add a credit/debit card to the account. You can then use the card you add to make payments directly from the card or linked bank account through PayPal. Verification involves verifying to PayPal that you are the cardholder. The process involves adding the card number, expiry date and the CVV number. After that, an amount equivalent to about 2 dollars is deducted from the card. The transaction appears in your card statement along with a 4 digit code that you are required to fill in PayPal to complete the verification.
5. Confirm Your Identity
After using your PayPal account for some time, you are requested to confirm your identity. This part of PayPal’s KYC process involves identity verification. PayPal simply wants you to confirm that you are the person your PayPal profile says you are. You are required to upload a government-issued identification card or passport, a utility bill as a proof of address, and a card statement as proof that you own the card that is linked to your PayPal account. If you have a business account, you will be requested to upload proof of business registration, license, etc.
The details in the documents you provide to PayPal MUST match the details in your profile-ALL THE TIME.
6. Disputes
Malicious clients or fraudsters can file disputes against you and claim they didn’t receive what they paid for (or what they received was significantly different from what they had ordered) or they didn’t authorize a payment they paid to you. If a client files a dispute claiming they didn’t receive what they paid for, PayPal gives you the chance to respond to the dispute via messages to the sender. If you are unable to reach a solution or if the sender escalates the dispute to a claim, PayPal intervenes and requests you to provide proof that you delivered what you were Paid for.
As a freelancer, always keep records of your correspondence with your clients as they come in handy in such situations. Gather all the correspondence you have with the sender and upload it as evidence. That way, you stand a good chance of winning the dispute.
7. Inability to Reset Your PayPal Account Password
If by bad luck you happen to forget your password, you may find yourself unable to reset it. Of late, a lot of users have been locked out of their PayPal accounts completely. Normally, to change your password, you click on a “having trouble logging in” link. This takes you to another page where you are prompted to fill in the email address you used to create your account. If you can’t remember the email, you are prompted to fill in any three email addresses you may have added to your account.
If you have filled in the correct email address, the next page performs a security check on you in two steps. You are presented with up to four security check options, out of which you must pass two. These are:
- Receive a text through the phone number in your profile
- Receive an email
- Answer your security questions
- Confirm your credit card number.
Now, this is where it gets messy for some users. When creating their PayPal accounts, most people skip setting security questions and linking a card. This means they are only presented with option 1 and 2.
However, option 1 only works if you filled in the phone number in the correct format i.e. country code follower by the number, but without a zero (+25470123456). With the phone number filled incorrectly, the PayPal system is unable to send the text to your phone number. Option 2 always works and a code is sent to your email, but it is not enough alone. As a result, you get locked out of your PayPal account permanently.
How can you manage to access your account again?
The easiest way is to recall your password. Even then, you might have to delete all your browser history and cookies for the password to work.
If that fails, call PayPal and explain your problem. Make a specific request for them to edit the phone number in your profile appropriately for you to be able to receive the code. The agent you talk to might refuse to do so but if you call over and over again, you may land a kind call center agent.
To avoid falling victim to such an eventuality, enhance the security of your PayPal account by:
- Making sure your phone number is filled in correctly and is confirmed
- Adding a credit card and verifying it.
- Setting up security questions
8. Inability to Withdraw Money From a Limited PayPal Account After 180 Days
If your PayPal account is limited permanently, you are told you can only withdraw any money therein after 180 days. However, after waiting for the 180 days to lapse, you realize by default that you can only withdraw your balance to a US bank account. Even if you had linked your PayPal account to Equity bank or Mpesa, it is impossible to withdraw the money to those accounts.
For you to be able to withdraw that money, you have to call PayPal and explain to them that you don’t have a US bank account as you are in Kenya and the only option you have is Equity bank or Mpesa. That way, they will temporarily enable the withdrawal option for you.
If your account was not linked to either Equity bank or Mpesa at the time it was limited, you won’t be able to link it. To withdraw any money stuck there after 180 days, you have to plead with them to transfer the money to another PayPal account that you can access. However, the agent you talk to can turn down your plea. If your plea is not successful, call again until you get an understanding agent; it’s really a like a game of chances and it all depends on the mood of the person you speak to.