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PayPal Account Frozen: What to do?

The words leave a pit in your stomach: “Due to security concerns, we will be holding your funds for 180 days.” When your business relies on PayPal, the rug can be pulled out from underneath you at any moment. Your account could be frozen with no warning and no way to access your money.

This is a frustrating and scary situation to be in, but it’s important to remember that you’re not alone. Many businesses have had their PayPal accounts frozen, and there are steps you can take to minimize the damage.

First, it’s important to understand why PayPal may freeze your account. There are a few reasons that this could happen:

You have been selling high-risk items: If you sell items that are considered to be high risk, PayPal may put a hold on your funds. This includes items like jewelry, tickets, and digital goods.

You have a high volume of transactions: If you make a lot of sales in a short period of time, PayPal may put a hold on your funds to protect itself from fraud.

You have received chargebacks: If you have received a chargeback, or multiple, PayPal may put a hold on your funds to make sure that the customer is happy with their purchase.

You have a history of account issues: If you have had problems with your PayPal account in the past, such as chargebacks or fraud, PayPal may put a hold on your funds.

Alot of the times, you might have done all of these things and your funds are STILL frozen with PayPal with no way to access them.

The harsh truth is this it the case the majority of the time.

Here are a few things you can do in the future to minimize your risk in the future:

  • Keep good records: Make sure you keep track of all your transactions and have documentation to back them up. This will help you if PayPal asks for more information about a particular sale.
  • Communicate with your buyers: If you are selling high-risk items, make sure you communicate with your buyers and provide tracking information. This will help to prevent chargebacks and fraud.
  • Spread out your transactions: If you make a lot of sales in a short period of time, try to spread them out over a longer period of time. This will help to avoid PayPal’s fraud filters.
  • Use a high risk merchant account: If you sell high-risk items, you may want to consider using a high risk merchant account. This will allow you to process credit cards without going through PayPal. In general, working with a high risk merchant processor like Merchant Processing Pros eliminates the risk of holding funds. We work with trusted banking partners that keep our clients business running smoothly.

If your PayPal account has been frozen, don’t panic. There are steps you can take to minimize the damage and prevent it from happening again.

By understanding why your account may be frozen and taking steps to prevent it, you can protect your business from PayPal’s whims.

If your account has been frozen, contact us today for a free quote to keep your business and cashflow moving: