Application refused at PayPal

What is happening

Reserve. PayPal can make all or part of your business balance unavailable for withdrawal. The U.S. user agreement describes rolling and minimum reserves; PayPal's business guide also names a jumpstart reserve. The agreement's example is 10% of each day's payments held for 90 days. That is an example, not a rule. Reserved funds show as "pending", and PayPal tells you the terms. Its guide says it reviews your account within every 180 days.

Payment hold (payout delay). A held payment shows as unavailable or pending. The user agreement says risk-based holds generally last up to 21 days from the date the payment arrived. PayPal may release earlier, for example after you upload shipment tracking. If the payment is disputed, the hold can last until the matter is resolved, but no longer than 180 days.

Limitation (transfer blocked). A limitation can stop you from sending, receiving or withdrawing money. A withdrawal pending when a limitation or hold starts must be started again once it is lifted.

Closed or limited account with a balance. Among the actions it may take after restricted activities, the user agreement says PayPal may hold your balance for up to 180 days if reasonably needed to protect against the risk of liability, or if you violated the Acceptable Use Policy. A court order or other legal process can make it longer. If PayPal closes your account, it will give notice and make unrestricted funds available for withdrawal. You cannot close the account yourself while it has a hold, limitation, reserve, open dispute or negative balance.

Account refused. A U.S. account is for businesses organized in, operating in, or resident of the United States. For a business, PayPal asks for the business name, business address and taxpayer identification number. Until it verifies them, a business balance can only go to a linked bank account or debit card, or be sent by check.

Common triggers

PayPal's documents name these:

• New sellers, or sellers with little selling history
• Higher-risk items, such as electronics or tickets
• Many claims, chargebacks, disputes or returns
• A new or high-cost product type, or a sudden rise in sales volume
• Industry chargeback risk, delivery times, credit history and processing history
• Suspected unauthorized use of your account
• A breach of the user agreement or the Acceptable Use Policy
• A court order or other legal process

What to do in the next 72 hours

1. Read PayPal's email. A notice about a held payment is titled "An important message about your PayPal balance". The same alert appears on your Account Overview page.
2. Log in and open the Resolution Center, or click the bell icon at the top of your Dashboard. It shows the reason and what to do to remove a limitation, if that applies.
3. Check the balance "on hold" to see the reserved amount and the planned release date.
4. Send the documents or information PayPal asks for, through the channel it names. Be honest and consistent with the platform.
5. Upload shipment tracking for held payments where you have it.
6. Do not open a new account to get around a limitation. The user agreement lists this as a restricted activity.

Documents to gather

The user agreement says you must cooperate with PayPal's reasonable requests for financial statements and other documents. It also mentions:

• Your business name, business address and taxpayer identification number
• Proof of shipment or delivery: a verifiable tracking number and the shipment date from the shipping company

PayPal's dispute guide suggests keeping:

• Tracking that shows delivery to the buyer's address
• Order details, receipts and invoices
• Customer emails or chat logs
• Product listings and photos
• Your refund and return policy

Letter template (editable)

Copy it, replace the parts in braces, and send it yourself through the official channel. The free plan fills in your own facts.

Subject: Request for information about my held PayPal funds

Hello {platform} team,

I am writing about the business {business_name}, account email {account_email}.

Since {started_on}, {amount} has been unavailable in my account. The reason I was given is: {reason_given}. The release date I was told is: {announced_release_on}.

Please tell me:
1. The reason for the hold, reserve or limitation, if you are allowed to share it.
2. The exact amount currently held.
3. The expected release date.
4. Which documents or information would allow a review.
5. How the remaining balance will be returned to me.

Thank you,
{your_name}

Keep selling while you wait

• If you need another way to get paid, choose a processor that accepts your real business profile and country.
• Tell your customers clearly if a payment method changes.
• Keep shipping on time, with tracking.