PayPal to set payment limits

Arathi Nair
Arathi Nair July 9, 2022
Updated 2022/07/09 at 6:42 PM
PayPal

According to a recent announcement from the firm, PayPal is imposing new restrictions on a function in its payment system that enables users to receive money without incurring additional fees. Only personal PayPal accounts, which are designed for trusted recipients, will be allowed to send money via the Friends & Family transaction method as of July 28.

PayPal offers two different methods for sending money: Friends & Family and Goods & Services. F&F is designed for situations where you know who is getting the money and what you are paying them for, like paying a friend back for dinner or giving your child some birthday money. Although there usually isn’t a charge, protections against potential problems like refunds or scams are also lost.

Money sent through G&S is for purchases only and is subject to PayPal fees. Everybody despises fees! But with G&S, you may frequently get a refund for the purchase if the item you buy isn’t as represented, it’s damaged when it arrives, or it simply never gets to the customer.

Even though it’s technically against the law to accept payments for goods and services through F&F, many firms handle transactions utilising a PayPal business account. The buyer might not be aware of the distinction or care, or the company and the client might decide to transfer the money that way in order to avoid seller fees.

Some authors who use PayPal to manage their businesses and will now be charged additional transaction fees are already displeased with the development.

Due to this new change, individuals who use PayPal for their business will no longer be able to make fee-free personal payments from friends and family without first opening a personal account.’

PayPal

Questions about whether PayPal changed the rules to crack down on improperly classified purchases were not immediately answered by PayPal, but the company did state in the announcement that the change will “drive consistency on [the] platform” and “[remove] confusion around which payments are eligible for buyer and seller protections.”

The transaction fee structure for products and services would change starting later this month, according to PayPal’s notice. Sellers currently pay 2.89 percent plus $0.49 for each transaction; however, as of July 28th, this will drop to 2.99 percent with no additional flat cost.

For more such updates, keep reading Techinnews

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