PayPal for business? Think again…

I was a PayPal customer for 2 hours last week. 

It took me less than 5 minutes to sign up for their service, link it to my credit card and receive my first of many “unable to verify your account” error messages.   The next hour and 53 minutes were spent in Kafkaesque conversations that escalated through three levels of PayPal’s Customer Support organization.  It turns out that they actually could verify my account.  That error message was a programmatic cover for their Risk Management policies.  The truth is that they simply didn’t want to do business with me.  The last two minutes of my relationship with PayPal were spent closing my account and receiving their canned “sorry to see you go” email addressed with the subject line “Student Account(s) Closed”.

An aptly misguided ending to my PayPal education.

It all started innocently enough with a $12K invoice from our Belarus Development Center.  Listed on the invoice was payment information for both Bank Wire Transfer and PayPal.  Since an increasing number of our Business to Business clients are integrating our Corevist service with PayPal, I thought I’d get a first hand education of what it was like to work with them.  Besides, since cash is king in our company, if I could gain an extra 30 days use of my cash by using PayPal linked to our corporate credit card, life would be good.

I was shocked to learn that PayPal is not interested in my business.

They didn’t come out and say that directly, but what they did say was that my account was flagged by their Risk Management Department and I would not be able to pay that $12K invoice…just yet.  I would first have to establish a credit history with them, with smaller payment amounts, then “maybe” a payment of that size could eventually be processed.

Wait a minute!  “Maybe”?  There is no “maybe” in business.

I know for a fact that I’m going to be invoiced monthly.  I also know for a fact that my supplier is going to want to get paid monthly.  Can’t PayPal tell me for a fact whether I’ll be able to use their service for this purpose and what I needed to do to make that happen?

Three levels of management abdicated their responsibility by saying “the computer is in control of our risk management policies”.  All three went on to apparently be reading from the same script went they calmly repeated “you’ll have to make a series of smaller payments over time and then maybe you’ll be able to process a payment of that size”.

Look, I get how this looks.  Brand new account is opened in the US and immediately wants to transfer $12K to a foreign entity.  All sorts of drug, terrorism, espionage alarms must have gone off.  But their new account registration process must have also uncovered that:

1. I have a FICO score of 852.  That is an “exceptional” score according to FICO.
2. The Citicard that I linked my PayPal account to has been open since 1993.  That’s 22 years of credit history!
3. I have a credit line of $50K on that Citicard credit card.
4. I answered every security question posed by their customer service representatives correctly.

In spite of all of that, no one could tell me if I ever would be able to use PayPal to pay these invoices.

Businesses pay invoices all the time.  PayPal won’t let me pay invoices.  Therefore, PayPal is not for business.

QED!

Account closed.

Sam