Does PayPal Hold Funds for Sellers?

Have you ever encountered issues with PayPal? Most of us have, while this online banking and financial management application is fantastic and incredibly useful for businesses and individuals, it does have some room for improvement. 

Before you decide to use PayPal for your business, perhaps you have some questions, such as curiosity around how to manage a PayPal account, if they have specific business features, such as invoices, and does PayPal hold funds.

Today, we won’t focus on how you should manage your account, or PayPal features, but instead we will focus on if PayPal holds funds. We also want to focus on helping you figure out why they might hold funds and what you can do about it if they are holding your funds. 

Does PayPal Hold Funds? How Long For?

Your funds could be held by PayPal for a whole multitude of reasons. However, there are some reasons which may make it more likely, we will look into this later. 

So, does PayPal hold funds? Yes, they do, but not for no reason. If your funds are held by PayPal, how long can you expect this to go on for? Well, it depends, although the maximum is often 21 days. 

That being said, there are some things that you can do to expedite this. 

One good way to look at what you can expect from your PayPal account is to look at the User Agreement. This will give you more information on the other reserves and holds that they may choose to place on your account. 

How Can You Access Your Money Sooner?

Should there be no issues with the order which your funds have been held on, you could expedite the release of any funds which are temporarily unavailable sooner than the  21 days which have been scheduled. 

You could do this, by taking 2 possible actions via your PayPal account. 

1. First you could print a USPS/ UPS shipping label, and the release would then be a day after delivery. To do this, simply print off a USPS. UPS shipping label from the PayPal account associated. This will automatically update tracking information and any confirmation of delivery.

2. Alternatively, you could just add in tracking information, and once more the release would be a day after delivery, provided that you are delivering with a PayPal supported carrier. You just need to upload the supported carrier’s tracking number. After this the payment will be released within 3 days of the carrier confirming that the package is delivered. 

Which Carriers Are Supported By PayPal In The US?

As you can see, one of the above options to help you speed up the return of held PayPal funds is to provide tracking information with a supported Carrier. However, to do this you need to know which carriers are PayPal supported in the United States. 

So, for this, take a look at our list! 

• UPS.
• USPS.
• RL Carriers.
• RRD International Logistics USA.
• Mail Americas.
• DHL Express (Piece ID)
• DHL eCommerce US.
• Newgistics.
• Expeditors
• On Trac.
• Echo.
• FedEx.
• Ensenda.
• Globegistics Inc.

So, if you decide that you will make use of supported carrier tracking to prevent PayPal from holding your funds, then you should consider one of these 14 carriers. 

How Can You Prevent Your Available Funds Being Delayed?

Once is enough for the delay of funds in your account, so you want to prevent this kind of problem from plaguing you again. There are several different things that you can do to prevent this happening in the future. 

Take the following steps, so your funds are never delayed! 

Step 1

Always review the email which PayPal sends, as well as the following alert found in your account review. 

Step 2

Should a buyer pay you, but the payment is not available immediately, PayPal will notify you in an email which has the subject “An Important Message About Your PayPal Balance”. Or there will be an alert in your account. 

This will be the best source of relevant information as to why the payment is not yet available, and how you can prevent the delay. 

Step 3

You can prevent chargebacks, refunds, and disputes in five following ways: 

• Always be clear about the handling and shipping time, as well as methods and costs. Process orders quickly to prevent and avoid painstaking delays.
• Always clearly define returns policies in an upfront manner to avoid any later problems.
• Set yourself up to be successful by always posting detailed photographs and descriptions, so buyers are always 100% aware of what they will receive from this purchase.
• Upload tracking information of supported carriers, or print UPS/USPS shipping labels. 
• Pack products with care in appropriate, and high quality materials so that customers always receive their items in a good, undamaged condition.

Step 4

Always communicate well with your buyers. If a customer should contact you, always try to be helpful and responsive, doing so very early on can be a great preventative measure in the future. Honest and frequent communication can help any misunderstandings clear up much faster.

Step 5:  Put the effort in to set up customer service messages in the ‘Resolution Center’, doing so can prevent any problems. If a shipment was delayed due to a natural disaster, you can let the buyer know, and thus disputes are unnecessary and avoided. 

Why Might Your Funds Be On Hold Or Inaccessible?

So, why might PayPal hold your funds? Here are 5 primary reasons why. 

1. This is your first time as a seller. 
2. You have not sold in a while/ have been dormant.
3. You have had multiple customers request a refund, chargeback, or dispute.
4. Your products are high risk.
5. Your selling pattern seems to be unusual/ sales activity is unusual.

Overall

PayPal does indeed hold funds, but they do not do it for no reason. Always check your account and be aware of activity on your account that may influence them to hold your funds!