PayPal Hates Its Customers
By now you have probably heard that PayPal changed their fee structure without telling anyone. I guess they were just hoping that no one would notice the extra 1% coming out of their hard earned money. However, it’s worse than that.
I don’t usually rant here, but these changes to PayPal drastically affect work at home moms because if you sell online or have a freelance business, chances are you use PayPal. I know I do. I’ve looked and looked for alternatives, but buyers all seem to want to use just them.
My Own Lousy Experience
I have had personal experience with how crappy their customer service is (emails are usually returned with “we can’t help you”). When I left Canada, I had a Canadian account, with a bank account attached to it. I had set this bank account up as a joint account with my mother so that I could have her add money if needed and I had the debit card to it. I sold a computer right before I left and my sister was to send it out when I got payment, since the guy hadn’t paid before I left. When he did, I told her to send it, she didn’t for a couple of weeks and the lack of delivery was reported to PayPal. Though this was resolved with the buyer, Paypal shut down my account, taking the $400 that was still in it. Not only that, but the account was never completely closed, just frozen, which meant I couldn’t set up another PayPal account with my bank account attached. That’s the main reason I didn’t earn much in writing for my first few years down here . . . I had no way to get an account without returning to Canada and having to create a NEW bank account.
Existing Issues with PayPal
There are a number of existing problems with Paypal. You can find them mentioned everywhere on the internet. Here are the ones that I see as being the worst.
1. Very specific countries. Many countries that could really use the access to online money don’t have it. That means fraud if they want anyone to pay them.
2. Existing accounts lack features. Canadian accounts were able to to get debit cards for their accounts a couple of years ago. PayPal discontinued this. Americans can still use these cards. Guatemalan accounts were able to receive payments but not connect the accounts to a local bank last year . . . but this inexplicably changed after a few months . . . now you can load a credit card to your PayPal, but cannot receive payments. None of this makes much sense and it renders many international accounts useless because no one can get their money out.
3. PayPal does what it wants when it wants and doesn’t tell people. Oh, yes, this is an ongoing issue! The above mentioned changes were never made public. People found out by attempting to do what they had done before and being refused.
4. Making refunds without actually checking into the issue. I’ve had this happen to me. I have sold services, had the client complain to PayPal and PayPal then withdrew the money from my account and gave it to the client without even verifying my side of the story. Scary!
The New Issues
PayPal is definitely pushing things with their new policy changes. I had heard that the changes didn’t affect you if you have a Premier or Business account, but that’s false. It DOES affect anyone who has a PayPal account.
What’s more, they are now charging by country. Bad news for those who live outside their preferred zones. Converting currencies whacks you with a lovely 2.5% on top of the exchange rate, as well. More punishment for anyone who isn’t American . . . seeing a trend here?
Here is one of their changes to policy from their site:
I don’t know about your clients, but I’m pretty sure mine are going to be wanting ME to pay those fees and that means I either have to raise my prices to accomodate the new fees or find a new payment method.
There is also a lot of mumbo jumbo about customer protection, but I personally don’t believe any of it. I’ve dealt with PayPal on several disputes and issues and they have never resolved a single one. If I was the one initiating, the response was always that they couldn’t help me or there was no response at all. When someone else initiated it, they removed money directly from my account to pay that person or made it impossible for me to refuse to pay the person back. I’m fine with making refunds when the situation warrants, but I want that to be my call and also to apply to ME when I have an issue.
If anyone were to start up a legitimate, functioning and international alternative to PayPal, I think a little competition could do them good. And yes, I am aware of places like eGold, etc. but none of these has a very good reputation . . . not good enough that clients would want to use them, anyway!
Thoughts? Ideas?
I’m speechless.
I’d known that Paypal was not really helping, however I had no idea how bad it was getting.
I have a couple of friends who’ve complained about refunds being taken from their accounts without being notified in advance, in some cases where there shouldn’t have been a refund.
Can anyone say “Monopoly”?
I’ve heard many Paypal horror stories on forums but they’ve all been Australian based. I’ve never heard of them being quite so bad.
I’m not certain they know what monopoly means. Maybe I could send them a dictionary along with some ideas of how to treat people nicely.
I must admit the Paypal support is a bit on the lacking side, unless you call them. I had good results actually calling them and talking to a rep. The trick is to wait through all the automated menu options, then there is a pause (as if there are no other options), and then it will give you an option to speak with a customer service rep. I haven’t heard about the increase in fees. I’ll check into it.
I have to admit that I have not tried calling PayPal, mainly because I live in Guatemala and the cost would be prohibitive. Good to know that it works that way, though.
Genesis, you could use Skype to call. You’d still have to work out the time zones though.
I had the same issue with my usa paypal account although i always accessed from canada. When i left canada to live in south america my account was frozen with $750 in it and they asked to confirm address etc.. My company was no longer active in usa and while frozen they let you change address you can`t change country while the account is limited.
Anyways, that was much needed money at the time. Took me 12 months to get to it. Bottom line is, no way in hell I would rely on paypal to make a living. The way I see it is , you can make all the money you want and even have several accounts all legit but they could take your money at anytime and you are screwed. As an affiliate marketer there are many other options for receiving payment but I understand those that rely on it are trapped.
I hadn’t actually considered that, thanks for the idea, Melinda!
Michael, that’s a lot of money to be frozen when you are in S. America! Unfortunately, since my main source of income is still writing, PayPal is pretty much my only option. Clients simply aren’t willing to pay another way and will just go elsewhere if I don’t accept it. It’s a bit of a pain.
Wow – Im a regular paypal user and to be honest this one went right over my head! I had no idea at all that there were new fees in place. Thanks for letting me know. Epassporte.com is another online money tranfer that I use and they also recently changed their fees…
I too had no idea PayPal had imposed new fees. Looks like I will be looking for another online company to handle my business.
I didn’t know about this, looks like these companies are getting too big for their boots.
I wasn’t aware the fees had changed either. This will affect many people who work at home. Maybe it’s time for another company to step up and show paypal what they can lose.
I’ve been burned by paypal in the past.
A customer got my account frozen for 6 weeks until his credit card company ruled in my favor. With no help at all from paypal, I might add. Except for my monthly eHow payments I don’t do much business with them anymore.
I have used paypal less and less over the years but I rarely use it now at all. I used to sell on Ebay which happens to own paypal, and as time went on both companies did more and more stupid things. At the time they had zero competition. Now you can use google check-out and I do any time the option is provided. For myself, I have begun billing clients the old fashion way
Google check-out does sound like the way to go, if it’s offered that is.
I really wish I had the option to dump PayPal, but unfortunately all my writing clients still want to use it!
I don’t think Paypal hates it customers. It’s just they love money so much.
I am trying to start a new work at home moms blog and would appreciate any advice that you have.. and feedback!
Thank you!
I am also looking for review writers.. People who work online and their stories!
wow really, i had no idea and with the fee from ebay. Wow