NWREBEL
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posted on January 5, 2002 07:33:28 AM new
http://www.swapselltrade.com/ROLLING%20RESERVE.htm
This a new feature of paypal and its called a rolling reserve. We have been informed by paypal that they will now hold 5% of our daily deposits over 6 months interest free so in case we ever close our paypal account they have a fund to cover potential chargebacks over 6 months. Sounds good but I wonder why we dont get interest on these funds? Or is this money being used to paypal expenses due to heavy losses to date? Any one else been set up on this REFRESHING PROGRAM?
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stopwhining
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posted on January 5, 2002 07:46:00 AM new
i just followed your url and saw your account page,it looks like 100% of your balance is held in rolling reserve?
i also just checked my account,nothing has been held and there is no caption of rolling reserve?
i am a premier account with a rating of 300,does that make any difference??
i also read paypal policy on rolling reserve,no mention of who gets targeted ??
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NWREBEL
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posted on January 5, 2002 07:51:20 AM new
Paypal said my account has been selected for this feature due to potential chargebacks and high volume processing. We do $50,000 to $70,000 a month via our payment sytems (merchant account and paypal) and I suspect paypal is concerned that if for some reason that I closed my account that they would have no access to any funds if any chargebacks roll in after I close my account. No they only take 5% of your total daily deposits. I just cleared my paypal balance to watch this new feature to see how they take money and when. It doesnt show in my historyu what so ever. I woke up this am with this new feature before I had coffee. 
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stopwhining
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posted on January 5, 2002 08:00:54 AM new
okay,so they are targeting members with high volume ,thats a lot of $$ a month,good luck.
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GU1HToM
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posted on January 5, 2002 10:35:26 AM new
You have got to be kidding me....
5% per day for 6 months?
& if that 5% is $100 a day they will have $18000 before they decide to start giving it back.... No Interest? No Nothing...
Just doing rough calculations at minor interest rates means they will be making an extra $800-1000 in interest over a year that they are not giving to you!
If they are going to hold the money as security they should at least give you the interest on it as well.
This is just plain disgusting.
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NWREBEL
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posted on January 5, 2002 10:46:58 AM new
I dont agree with need for this fund as all chargebacks we have incurred have been paid with promptness. Paypal has never incurred a chargeback where they couldnt recover the funds from our account. So my speculation is this new feature is a away to funnel cash into operating expenses and I bet my last dollar that over 75% of these reserve funds will be depleted with chargebacks that paypal seems to find out of thin air. I think paypal should show documentation to its member to verify there is an actual chargeback. If they dont document whats to stop an company from saying you have a chargeback when in fact you dont so they can once again take in more cash. For the record I have had 1 chargeback with my normal Visa Mastercard account and 33 attempted chargebacks with paypal that we have won with providing tracking numbers and so forth. I find the disparity in the numbers a little interesting and I am willing to be the test goat for this new feature just to see what happens at the end of the 6 month run. 5% being saved for us if indeed paypal returns it. I also agree to these terms because so many people do use paypal and feel safe spending money this way and as a business man you must accept what the customer wants. One good thing that prevented me from leaving paypal is that they do send me over 200 hits a week to my site from the paypal search engine. So the good weighs with bad.
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paypaldamon
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posted on January 5, 2002 02:19:44 PM new
Hi nwrebel,
Customer funds are not used for operating expenses. They are kept in entirely separate accounts.
I have received several issues from you in the past, and it does appear that you have had a fair number of chargeback issues/complaints in the past. In order to minimize the risk of loss, a rolling reserve is in place (this is not uncommon to a merchant service provider).
I can have the merchant team contact you about this if needed.
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NWREBEL
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posted on January 5, 2002 02:22:56 PM new
I dont have a real big issue with the reserve the way its set up but I would like documentation from the originating bank that a chargeback is being placed rather then just paypals word? Can we see this information when the chargeback is presented? Just to keep things honest?
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NWREBEL
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posted on January 5, 2002 02:26:40 PM new
Damon for the record I do have a normal merchant account with www.cardservice.com and have used them for a year and only have one chargeback becuase I didnt use a tracking slip. I am just concerned with the number of chargebacks alledged by paypal versus my normal account. The ratio is not even close and I want to see further documentation that these chargebacks do exist and that paypal is actually giving the money to the appropiate bank. My bottom line question is why cannot we see the chargeback proof from the issuing bank? Could you please answer that one question? Joe
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stopwhining
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posted on January 5, 2002 04:18:49 PM new
5 % of daily rolling average is not 18,000 after 6 months for a 100 dollars balance,since balance fluctuates daily,if your balance falls below prior day balance,nothing additional is held back.
if you start with 100 balance and keep rising every day,additional amount will be heldback .
on the the first day after 6 months period,they will release whatver is over the 5 % of last day of the six months period.
if i understand this formula right,a seller who sells steadily using paypal to accept payment will always have 5 % give and take a little held with paypal.
i think they do that with sales of high risk receivables,an amount will always be heldback just in case and there is no interest accrued or paid for that .
i read somewhere that buy.com has filed for bankruptcy?but chase manhatten bank which provides its merchant account is holding one million dollars of its deposits as buy.com chargebacks was very high due to fraudulent use of cc on that site.
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GU1HToM
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posted on January 5, 2002 07:45:00 PM new
What math are you doing?
If he does an average of $2000 a day then $100 a day goes into the rolling reserve.
It is based on Daily deposits not daily balance.
So after 6 months when they start releasing funds they will have 18000 (180 days x $100)
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stopwhining
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posted on January 5, 2002 08:36:58 PM new
holy smoke-you are right,it is daily deposit,not daily balance.
YES,AFTER 180 DAYS,it can add up to a bundle.
now i have to treat my customers who pay me money order with mucho respect.kidgloves??
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