PayPal dispute nightmare : Another reason to use

PayPal is well-established as a digital vehicle for sending and receiving payments. It’s adopted by millions of consumers, and over the course of almost 20 years it has adjusted its policies to better serve them.

Still, there are issues that can creep up most unexpectedly.

A recent payment that I received, was reversed with a dispute filed by the customer, several days later. Funds were frozen, and my balance turned negative, in the thousands of dollars.

After communicating the issue with the customer, it became evident that their bank’s security system had overreacted to the payment. Their account had sufficient funds, but was set up to block ACH transfers; once payment was made, the transaction was flagged as fraudulent. Forty-eight hours later, PayPal seized the funds.

Thankfully, the customer provided a secondary payment, covering the artificially generated negative balance, but the case is still pending almost two weeks later. I’m still not sure if they will reverse the fund reversal, in which case I will refund that payment, or if they will directly allocate the funds to the customer’s account, for an activity that was fully legitimate.

Such issues can be avoided by using for contracted services.

This is a category not as popular with domain name investors, but in this case it makes sense. is not just about mutual trust, it’s also about efficiency and about avoiding such time-consuming glitches and the lengthy withholding of funds, for no real reason.

As a satisfied customer of for 15 years, I will definitely utilize it beyond domain name transactions in the future.


  1. Agreed. I learn this same lesson the hard way using PayPal subscription services to bill for domain payment plans. Experiencing blind refunds with no recourse is not good for biz; therefore, I strictly deal with Escrow, or here lately I’ve been suggesting Payoneer.

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