PayPal glitch unlocks payments on hold

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A PayPal glitch is allowing users to withdraw funds being held under the 21 day rule. A thread on the UK Payments and Postage board details how a user made a legitimate partial refund and discovered that funds became instantly available with the temporary hold removed. A similar thread on the US discussion boards was pulled by the moderators.

Some sellers have tested refunding as little as 1p and their payments have come off hold as well, allowing them to withdraw the balance to their bank account. The sellers who have reported this state that they have already been left positive feedback and so PayPal should have released the funds anyway. They’re not using it to release funds which are still legitimately on hold according to PayPal’s rules.

For anyone thinking of taking advantage of this we’d highly recommend that you don’t. PayPal can still hold funds or even freeze your account even if you’ve withdrawn the money. If you think the funds should be made available then telephone PayPal and ask them to remove the hold, rather than risk losing your account entirely.

15 Responses

  1. I wish I fully understood what this 21 day hold rule is at paypal. I dont sell on ebay much anymore, but was a power seller up until a few months ago when I decided to close my store down. Paypal has never placed a hold on my customer’s payments, so I’m really clueless as to why or when paypal is holding sellers payments.

    What criteria does ebay/paypal use to determine whether or not to hold payments?

    Does ebay actually expect sellers to ship merchandise to buyers without actually having the money in their account?

    Any insight would be greatly appreciated.

  2. Robert, if you were a powerseller, you’re almost certainly not going to hit the 21 day hold criteria. It doesn’t apply to sellers with more than 100 feedback.

    That’s not to say, of course, that PayPal might not hold individual payments for other reasons.

  3. Sue #3

    Oh yes it does

    Both myself and several of BuildaSkill’s long-serving-PowerSeller’s have experienced getting hit with the warning when listing, and the actual hold if one of those forewarned listings is paid via PayPal immediately or very soon after a buyer has dinged them with a neg feedback, or a very poor set of DSRs – regardless of other feedback and DSR history.

    Admittedly, it was a rare occurrence, and also it has not re-occurred to any of us who moved our eBay accounts off the UK recently, once those accounts were off the UK. One of our “inner circle” has accounts on both UK and foreign sites and has stated it has only happened on the UK account since the others were “expatriated” – on each of her accounts the current feedback is over 5,000.

    Rules like the conditions for that 21-day hold SHOULD be set in stone by their wording, but like many others appear to be getting applied on the basis of “if your face fits” – and this year, sellers based overseas, or with overseas registered accounts, certainly do not have faces that fit with recent exclusionary policies and actions by eBay UK.


  4. Will not hold payment if …

    “Your average DSR is greater than 4.5”

    So if its 4.4 they won’t hold it either Sue?, makes no sense to me.

    I thinks its best if I just retire for a while.

    Maybe you need to spell it out more clearly 😆

  5. PLEASE see the petition to remove John Donahoe a ebay’s CEO by doing an internet search of:

    “Ebay Stockholders and Sellers Calling For Immediate Termination of John Donohoe CEO”


  6. its a disgusting practice , holding the cash…………..totally onesided.Sellers are forced to send goods and wait 21days or for feedback.It effects lives as many new sellers neeed that cash.Ebay and paypal have lost the plot bigtime………

  7. Paypal have taken two of my payments under the 21 day rule in one day. I have emailed them 3 times and got ridiculous answers that are very little to do with what I have asked.

    I want to know what will happen if I post the item and the buyer posts negative feedback? This doesn’t mean they have to send the item back yet paypal have said they pay out the pending funds only if ‘positive’ feedback is recieved.

    I REALLY don’t want to post this item without getting the money for it and what right do paypal have to decide that I can only have the money if positive feedback is left? There must be some sort of trading law being broken here?

    It like me buying a bag of sweets and saying I will only pay if I can have one and say whether I like them first or I get to keep the sweets AND my money!

  8. I made an EBAY sale 2 days ago, and the buyer left me positive feedback right away, but my payment is still on hold.

  9. @ # 12

    PayPal is acting like an escrow service. I have no idea about what laws govern those types of businesses though I’m guessing PayPal will just say, “PayPal is not an escrow service.” Based on them saying that I doubt there is any law they are violating.

  10. Policies like this caused me to lose my 7 year eBay business back in May.

    My business model for 6 of those years was drop shipping.

    Can’t ship a customer’s product without their payment, right?
    Wrong – eBay told me to ship and I did ( trusted my TopSeller Manager and Paypal Manager ).
    $80,000 of product was shipped by paying my distributors with my own money.

    THEN – Paypal decides to freeze my account due to the high number of held payments….?


    I still am out the $80,000 for the last 6 months ( plus interest ) and am facing bankruptcy.

    I am married with a 3 year old and 4 month old baby.

    Ebay/Paypal can rot in hell.

    I am talking with the Canada Revenue Agency as well as a Law Firm here in Canada regarding a Class Action Suit.

    If you are Canadian and would like to join the lawsuit – contact me through this website.

    Thank you.


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