What is reasonable amount to leave in Paypal account?

alx2013

I pay off my Ebay fees then empty my Paypal daily

theonlywayisup

Following the recent collapse of a large PS - who's problems were of his own making initially - ebay closed his listings and cancelled sales forcing buyers to open cases for INR. All the funds in Paypal were frozen and despite it being in the £'000s he was only about £30 short as he had just made a withdrawal.

That led onto other events, but suffice it to say, had he had enough funds to cover the cases he would not be in the situation he finds himself in now.

His advice is to cover the sales which you have just made and that aren't with the customer.

I keep £2-3k balance. It is a lot of money but is really what I am "holding in hand" as the customer doesn't have their goods until they are showing as delivered. Whilst I am not immune from them opening SNAD, I can fend off the INR and maintain my account. Even though the goods may have left me, if the INR is opened I will be able to show delivery within 2 days and if it faiks to arrive, the customer can have the refund.

It is not for everyone, but for a business to work, you need "cashflow" and for me that flow also applies to Paypal and the quirks of Ebay.

Brooker_Dave

theonlywayisup wrote: »

His advice is to cover the sales which you have just made and that aren't with the customer.

Won't paypal cover the chargebacks, and then chase you for it?

Better for cashflow to get the money in the bank rather than leaving it parked in paypal's coffers surely?

theonlywayisup

Brooker_Dave wrote: »

Won't paypal cover the chargebacks, and then chase you for it?

Better for cashflow to get the money in the bank rather than leaving it parked in paypal's coffers surely?

I am drawing similarity to the fellow ebayer.

His account was finally resticted due to the fact he couldn't refund the cases. As his account was frozen, he couldn't add funds.

Yes, Paypal will cover the chargeback, that is not my point.

He wanted to continue trading, his restriction was due to a small error on his part, which (had the funds been in Paypal) would have left him intact eventually. He has lost a HUGE business because of this cash flow - not enough in Paypal to cover immediate problems.

soolin

theonlywayisup wrote: »

I am drawing similarity to the fellow ebayer.

His account was finally resticted due to the fact he couldn't refund the cases. As his account was frozen, he couldn't add funds.

Yes, Paypal will cover the chargeback, that is not my point.

He wanted to continue trading, his restriction was due to a small error on his part, which (had the funds been in Paypal) would have left him intact eventually. He has lost a HUGE business because of this cash flow - not enough in Paypal to cover immediate problems.

If it was the one I was thinking of, and it was a very sad case. It was not routine, seller was bankrupt so was unable to meet their debts once paypal were informed .

They would have been better off withdrawing the money to clear other debts and to try and keep trading, rather than leave huge balances in paypal that they didn't want swallowed into the black hole caused by bankruptcy.

It was very very sad though as seller was a genuinely good seller and just got hit by the recession.

There is no earthly chance of me going bankrupt and should I have issues I would be in a position to raise cash immediately on demand to repay a paypal debt.

theonlywayisup

It was him, but it wasnt quite as clear cut. This wasnt about raising money to cover a Paypal debt, it was to refund the Paypal payments before cases counted against him, he had the funds to add, but his paypal account was in lockdown.

Both his Ebay and Paypal account managers (and higher up the foodchain) ultimatley told him that had he been able to close the open cases (this is back when they counted of course) then they would have allowed him to continue.

The person dealing with his company bankruptcy (forgive me I cannot recall his title) gave express permission for the Ebay business to continue in order to facilitate the debts.

So whilst this was highly unusual and a lot will see the word bankrupt and assume all things, ultimately the business would have continued had the Paypal account had the meagre funds needed.

As I said, it is not for all. I know the person concerned and am happy I wont find myself in this situation, but for me, I know to cover the sales with a balance in Paypal.

Brooker_Dave

theonlywayisup wrote: »

His account was finally resticted due to the fact he couldn't refund the cases. As his account was frozen, he couldn't add funds.

I did have a similar problem with paypal, I emptied my account just before christmas, and then got an unexpected chargeback on boxing day, which caused paypal to freeze my account.

I offered straight away to make a card payment to get things squared up, but the said they didn't take cards (!?!) and I'd have to send a cheque to Delaware and it could take 8 weeks to process.

Fortunatly I had a proper card processing account with a UK bank, but it was clear that paypal operate under their own rules and it's fine when it works, but if something goes wrong, you've had it.

A friend of mine had his account with £11k in it frozen, and only got his money back by taking paypal to court - they released the cash and reinstated his account a day before the hearing, so it didn't actually go to court.

Lessons - always use a real card processor based in the UK, empty your paypal account daily, and as is always said here don't rely on ebay as your only source of income...

theonlywayisup

Booker, yes this sounds like a simplfied version of what happened to the person subject to my reasoning.

Yes, he had more going on and most of that was actually irrelevant. What ultimately caused the final collapse, was the lack of funds when a chargeback ocurred. Either you take the angle that Paypal will get their money now or later. If its now, you may salvage your business, if its later you probably wont.

Ebay is a tiny part of our businesses and our balance is small compared to turnover, so for us it is a solution.

It wont suit everyone, but what I am trying to say is that it is not as easy as some think; to add funds and cover a chargeback if you need to do it quickly.

A lot of people who come on these boards have withdrawn and spent funds to find a chargeback for SNAD. If you need the money quickly then perhaps Ebay and Paypal are not the first venue you should choose.

Brooker_Dave

theonlywayisup wrote: »

A lot of people who come on these boards have withdrawn and spent funds to find a chargeback for SNAD. If you need the money quickly then perhaps Ebay and Paypal are not the first venue you should choose.

Leaving a small amount in paypal might not be a bad thing, but leaving thousands in there seems a bit OTT.

How many returns and screams do ebayers get these days?

theonlywayisup

Brooker_Dave wrote: »

Leaving a small amount in paypal might not be a bad thing, but leaving thousands in there seems a bit OTT.

How many returns and screams do ebayers get these days?

But it has to be relative.

If you sell 5k a day, then leaving £100 is pointless.

But sell £20 and leave £100 could also be wrong.

I dont understand your final sentence, sorry.