Earlier this week, I called Paypal on a whim to talk to them about the giant rolling reserve placed on my account a few months ago. I’ve moved a good portion of my business away from them since they placed it, but I still process all of my recurring payments through their service (it’s a pain to migrate recurring payments) and I have a lot of money tied up in reserve.

To my surprise, the friendly customer support rep that I talked to removed the reserve from my account (both the rolling reserve and the minimum reserve) and released all of the funds for immediate use.

Initially I was thrilled about the windfall and withdrew it immediately. After the initial surprise wore off, I remembered some important facts:

• This was my money to begin with – not a gift from PayPal.
• If I had resolved my account issues to their satisfaction, why hadn’t anyone contacted me?
• What would have happened if I didn’t pick up the phone myself?
• What’s stopping this from happening again?

While I appreciate that PayPal worked with me and that I have my money, the whole experience has soured me on their service. I’ll continue to use them while it’s convenient, but during this period I took the opportunity to setup my own merchant account and integrate it with most of my payment processing.

They’ve lost 75% of my business and will lose another 20% in the next six months as I re-program my recurring payment setup. I don’t know what outcome they were hoping for, but I don’t think this is it.

This entry was posted on Friday, October 1st, 2010 at 11:38 am and is filed under General. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.