In the middle of raising the funds for Annie’s iPad, unbeknown to me, Paypal limited my account. That is why some of you were unable to donate.
Luckily for us and for Annie, Paypals actions didn’t affect our outcome as the gorgeous Nathalie had teed up a discounted iPad from her local Apple Store.
Marita went ahead and purchased Annie’s iPad on her credit card, knowing that the funds that you had generously donated would be available.
Mission accomplished internet. Annie has her iPad.
Can you imagine my dismay that same afternoon, when I went to send Marita the money and I saw this message.
Basking in the happy afterglow of our achievement, I should have been skipping around the house saluting the generostity of my lovely internetz. Instead I was left with an administrative headache that I didn’t want to talk about online, in case it put a downer on the collective happiness we were all feeling.
I was presented with a series of hoops I was required to jump through in order to get my account up and running again.
I managed to confirm my identity without any problems. I then had to upload a recent bank statement which I was loathe to do. Giving paypal that sort of information about my recent financial history made me very, very uncomfortable, but I did it.
Then I really hit a stumbling block, as I had used a donate button I had to explain my charity’s mission statement. Oh dear. I am not a charity I am just a person who wanted to harness the power of the internet to give a little girl an iPad. This is when I rang Paypal and began the five day process of lifting the limitations on my account.
Luckily for me, Marita was happy to wait until the Paypal funds were cleared and she refused my offer of paying her the cash myself.
Five days from start to finish, three phonecalls and various administrative hoops later, your money internet, is in Marita’s bank.
And I am sitting here trying to work out all the reasons why I am grumpy with paypal.
I am grumpy because paypal took $27.00 in charges.
I wasn’t aware of these sort of fees being applied. When I have donated in the past using paypal I just assumed that all of my donation would go through. So I am grumpy with my own naivety as well as Paypals business practice.
When I was talking to one of Paypals customer service representatives he told me that blogs were in a regulatory grey area and that the sort of limitations that were put on my account were quite common. He gave me the usual spiel about terrorism and money laundering and financial laws, etc. etc.
As I went higher up the corporate food chain the attitude of the employees wasn’t exactly condescending but it was tinged with a subtle arrogance. There was an undertone in the conversation that suggested that I was swimming in murky financial waters.
I am writing this blog post as a warning to other bloggers to be careful when using Paypal to raise money. Because even though a Paypal donate button with the tracker widget is a lovely and convenient way to raise money. It is also quite a headache trying to get your account up and running again if Paypal decide to limit your account.
All in all 32 lovely people donated $725 minus the $27 in fees and I was able to transfer $698 to Marita last night.
Now the question I ask myself is, “Would I do it again?” Yes I would, but I would have to think of a better way to collect the money raised rather than being at the mercy of Paypal. I think the fact that I presented myself as “high profile” Australian blogger helped to hurry along the procedure. As once I started to google Paypal complaints I found that some people have been waiting a long time to sort out these sorts of issues.
Anyhow internet, once again thankyou so very very much for helping to make this Christmas so very special for one little girl.
And as for you Paypal, I havent quite decided what to do about you just yet.
Comments on this entry are closed.
My advice? Ditch Paypal, and ditch them now. I know countless others folks here locally involved in non-profit circles who have been screwed over by and lost money from using PayPal. I’ll have to see if I can dig up the lawsuit that one of my friends was involved with and send it to you via email … it was enlightening, to say the least. Bottom line, though? They’re bad news for a lot of people with good intentions. I don’t trust them for a second and refuse to donate anywhere via them.
I’m sorry you had to go through this just to help make Christmas amazing for a little girl.
I reckon I will close my account with them. I cant quite get rid of the bad taste in my mouth. I look forward to seeing your info if you can find it. thanks.
Is there another option, other than just into a bank account? One of the annoying things is when there is no competitor to a company you don’t want to use…but maybe there is?
Anyone know?
I have no idea Clairy there were a few suggestions made to me on twitter earlier if you feel like checking who has @ replied to me.
It was a lovely act of kindness for Annie. Paypal took a % of money from when we raised it for Tiff too. It isn’t fair.
Fair and business, are not likely to be found in the same sentence Trish
Still a wonderful achievement Kim! Your heart is so big! Sorry for the head mucking around for you. Don’t let it take the shine off for Annie.
Oh it hasn’t taken the shine off at all Gemma. The tweets from Marita that day still make me a bit teary 🙂 I put this post up so that other bloggers could be forewarned about the potential implications if they do a fundraiser on their blogs. Knowledge is power, and all that 🙂
Regresty had the very same thing happen while collecting money for Xmas toys for kids. All starting over the use of the donate button apparently. 🙁
That was the one I was racking my brains trying to think of it.Thanks Candy. I knew I had seen the tweets about Regretsy but I had only skimmed them and not favourited the thread. Cheers
thanks for letting us know. I guess if you had been aware of their restrictions before starting out you would have been able to take that into account. I think it is when these things come out of the blue that it is upsetting. Glad you got it sorted and that your quest was successful.
Thanks Anna. I am trying to think of alternate ways to do similar fundraisers.
I’ve had problems with Paypal on principle for ages. They’re owned by eBay and are also the preferred method of payment on eBay, in fact your listing must include Paypal as one of the payment methods. And because it’s easy for the payer, everyone uses it. But for you, the seller, or the donation organiser, it means huge fees. It’s one reason why eBay is dominated by big stores these days, rather than individuals.
As far as using Paypal for donations, you must be a registered charity. I remember reading a few articles about it some time ago.
Always gotta do your research….
If I had done my research Dorothy, Annie wouldn’t have an iPad.
I have major issues with the size of Paypal’s fees. I don’t expect them to be a free service, but I think they’re a bit over the top and they hamper small businesses who operate within tight budgets. I especially have issues with the monopoly they’re trying to establish when it comes to online sales (and the worst thing eBay ever did was join forces with them!).
BUT…unfortunately, they really are subject to strict regulation when it comes to identification of customers, and to tracking the source/destination of funds. Having worked in the banking industry for 20 years, and in a government law enforcement area for the past 10, I actually know a bit about money laundering (by terrorists, drug dealers and others), the cash economy and tax/welfare cheats, and governments the world over are chasing their tails trying to stay ahead of these scum. The internet has made it easier for these people to move their money around and harder for law enforcement agencies to catch them.
There’s billions at stake, and Paypal, along with other financial organisations has had the squeeze put on them by government to put processes in place to ensure that their transactions are above board. I don’t know for sure, but I suspect that that US government are even more restrictive than our own lot.
The sad part is that small businesses, hobbyists and those like you trying to do something philanthropic, get caught up in the red tape. Paypal needs to streamline the process (and to train their staff not be A-holes) so that situations like yours can be resolved quickly and without the customer feeling as though their privacy has been violated. I’m sure that their motives are all good – pity the methods aren’t well thought-out.
By the way, if you find an alternative money transfer method that’s secure, guaranteed, easy to use and doesn’t involve giving out your bank details to strangers, I’d love to know about it.
Yes, the size of their fees were a shock to me as well and the fact that they were so steep. I could see where Paypal were coming from when they limited my account, I understand how business works and the flow on effect. It was more the tone that annoyed me.
Like Sarah said on Facebook, this is exactly what happened when we raised funds for Lori earlier this year. It all went through my account which was limited, then shut down, then back to limited amongst numerous emails and phone calls. I used the labs widget and no where in their conditions of use did it say it was for registered charities only but they didn’t want to listen to me.
I asked if they could waive the fees or discount them and they said no, only charities have discounted fees (they still have to pay!) but luckily a big business came along and donated an amount that in effect covered the fees.
If you’re still unsure if you’re going to close down the account then read this recent post about a similar situation http://www.regretsy.com/2011/12/05/cats-1-kids-0/ -I’m pretty sure it will seal the deal.
Candy reminded me earlier in these comments about the Regretsy affair. I hadn’t paid much attention to it at the time. But it jumped into my head as soon as my account was limited. I also used the labs widget Glow but I only skimmed the TOS as I was in a hurry to get the post up and start raising the price of an iPad. xx
Well, shit. I just put up a donate button with paypal on my blog, trying to raise money for my little brother & our sister & their mom. Timing is very much of the essence right now. Hold my hand?
*sigh*
Consider your hand held 🙂 and I haven’t closed my account down just yet.
All this makes me thankful I haven’t had any dealings with PayPal.
I’m glad Annie got her I-pad though.
I am very glad as well River 🙂
Thanks for the warning… What a right royal pain in the neck for you.
So glad Annie got her iPad! You did a wonderful thing.
The word that comes to mind Kate is aggravating. It was a nuisance and not being able to transfer the money through to Marita was what really annoyed me the most.
This isn’t the one that my friend was involved with, but is eerily similar. http://www.cowbellyblog.com/2010/06/18/the-truth-about-paypal-paypal-class-action-lawsuit-may-2010/ . Update at:
http://www.cowbellyblog.com/2010/07/29/paypal-update/
Thanks I am going over for a read now.
I hate Paypal with a passion. I have used it twice and had major hassles both times. I couldn’t even figure out how to contact them in order to try and get the issues resolved (this was several years ago). The second issue was never resolved to my satisfaction. They didn’t get the opportunity to strike out a third time! Hate. With passion.
Oh how annoying for you! Thankfully my account wasn’t limited when we did the Christmas Island thing last year though I was surprised by the charges. I can’t remember what I did about that anymore but i have one thing to add to your list – I dont like that on the donate button you have to choose the amout – it would be better if you could input the amount when you pay rather than the default being set to $5. Writing on the fly so hope that makes sense!